Shares of cloud computing specialist Rackspace Hosting (RAX) fell 17.7% Wednesday after the company announced an end to a "strategic review" that many believed would conclude with Rackspace selling out to CenturyLink (LUMN) or another bidder. The company also named President Taylor Rhodes as its new CEO.
In the following video, Fool analyst Nathan Hamilton asks Fool contributor Tim Beyers to explain the implications for investors. Are we witnessing a strategy shift? Is it time to sell Rackspace stock?
Tim says that he's holding on to his shares. He also says that nothing has changed with Rackspace's strategy, though he concedes that price competition in cloud hosting from the likes of Amazon.com and Google could make it tough for Rackspace to produce the outsized growth today's investors are looking for.
Why remain bullish amid the sell-off? Click the video to learn the two things Tim heard Rhodes say that gives him confidence, and the one metric that every investor needs to track.
