NEW YORK (TheStreet) -- AOL (AOL) spiked Tuesday after Verizon Communications (VZ) announced it would snap up the Internet pioneer for $4.4 billion in cash. Intel (INTC) edged lower after an analyst called its full-year forecast a little too high. Rackspace Hosting (RAX) tanked after posting weak earnings and forecast, as well as receiving a downgrade.
AOL surged 18.6% to close at $50.52. Verizon fell 0.36% to $49.62 for the day.
The Internet pioneer managed to race ahead despite a downgrade by Cantor Fitzgerald to sell from buy. In issuing the downgrade, Cantor noted a competing bid is unlikely to materialize because Verizon's buyout price is reasonable.
As a result, there are few catalysts to drive the stock higher, apart from the possibility that AOL will spin off its Huffington Post media site. Such a deal could potentially yield a $1 billion sale, according to a report in Re/code. Apparently, AOL and media company Axel Springer are in talks about a Huffington Post acquisition, Re/code noted.
Intel fell 1.4% to end the session at $32.25.
The chip giant stumbled after Citigroup analyst Chris Danely warned investors that Intel's 2015 full-year revenue outlook is likely too optimistic, according to a Barron's report.
Intel forecast flat year-over-year revenue when it generated $55.87 billion. However, Danely, according to Barron's, said that will be a hard figure for Intel to reach, given its historical performance in the second half of the year. Said Danely: