Yet the skeptics may be overreaching. Sure, Rackspace's revenue growth is slowing, but with gross margin rising, concerns over collateral damage caused by an ongoing cloud storage price war between Amazon.com (NASDAQ:AMZN) and Google (NASDAQ:GOOGL) are probably unjustified. In the video below, Fool contributor Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova addresses these concerns.
Rackspace is down 47% year to date despite notable progress in implementing its OpenStack infrastructure, which should help to produce higher margins and profits over time. It'll take awhile for the transition to take full effect, but when it does, look out above, Tim says.
Do you agree? Watch the video to get Tim's full take, and then let us know whether you think Rackspace Hosting is one of the best stocks to invest in now.
Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Google and Rackspace Hosting at the time of publication. Check out Tim's web home and portfolio holdings or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.
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