Rackspace (RAX) Stock Soars in After-Hours Trade on Takeover Speculation

NEW YORK (TheStreet) -- Shares of Rackspace  (RAX)  were jumping 15.25% to $30.60 in after-hours trading following speculation that the company is in advanced talks to sell to a private equity firm, CNBC reports.

The deal could be announced as early as this week.

Rackspace, a San Antonio, TX-based data hosting technology company, has a market cap around $3 billion, but the deal could value the company at up to $4 billion, according to sources cited by Barron's.

The stock was halted briefly following the news but has since resumed trading.

Over 3.31 million shares of Rackspace were traded today, above its 30-day daily average of 1.82 million.

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

TheStreet Ratings rated this stock as a "hold" with a ratings score of C.

The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

You can view the full analysis from the report here: RAX


More from Markets

Dow Ends Off 125 Points as Caterpillar, 3M Earnings Disappoint

Dow Ends Off 125 Points as Caterpillar, 3M Earnings Disappoint

Multiple Tailwinds Take Shape That Could Drive BP Gains

Multiple Tailwinds Take Shape That Could Drive BP Gains

Tesla Critic Citron Research Changes Its Mind, Goes Long on the EV Maker

Tesla Critic Citron Research Changes Its Mind, Goes Long on the EV Maker

Verizon Beats Q3 Earnings Estimate, Postpaid Phone Additions Top Forecasts

Verizon Beats Q3 Earnings Estimate, Postpaid Phone Additions Top Forecasts

Philip Morris Rolls Out New Smokeless Cigs to Fire Up Sales

Philip Morris Rolls Out New Smokeless Cigs to Fire Up Sales