Shares of Rackspace Hosting, Inc. (NYSE:RAX) stock entered the day off about 5% year to date. Will the slide continue, or are better days ahead? A lot depends on how well the business performs. Here's a closer look at what analysts expect to see when the cloud computing specialist reports third-quarter earnings on Monday afternoon:

Q3 Estimates
Revenue
YOY Growth
EPS
YOY Growth

Low estimate

$456 million

17.3%

$0.08

(27.3%)

High estimate

$461 million

18.6%

$0.18

63.6%

S&P CAPITAL IQ CONSENSUS

$458.62 million

18%

$0.15

36.4%

Source: S&P Capital IQ.

A beat would be a real achievement. Only once in the past four quarters has Rackspace reported more profit than Wall Street was targeting:

Earnings History
Q3 2013
Q4 2013
Q1 2014

Q2 2014

Consensus

$0.15

 $0.14

$0.12

$0.16

Actual

$0.11

 $0.14

$0.18

$0.16

DIFFERENCE

($0.04)

$0.00

$0.06

$0.00

Source: S&P Capital IQ.

Looking at the overall business, I'm watching for momentum in each of these four areas:

1. Improving revenue per server. The thesis for investing in Rackspace hinges on the idea that customers will pay up for higher levels of service and support in a cloud-hosted server the company owns, operates, and most importantly, optimizes. Growing revenue per server is one of the best indicators that the strategy is working -- and we've seen gains in each of the last four quarters. (From $1,290 per server per month in last year's third quarter, to $1,375 in this year's Q2.)

2. Stronger returns on capital. Along the same lines, Rackspace's ability to efficiently utilize resources to deliver a resilient, high-performance, and fully supported cloud computing environment should lead to successively higher returns on deployed capital. That's been tougher to come by in the OpenStack era: ROC fell from 11.9% in last year's second quarter to just 8% in the third quarter of 2013. Rackspace has improved since with a 10% return in Q2, but that was still down from 11.4% in the first quarter. Listen for an update on how management plans to achieve higher margins and ROC over the long term.

3. Large-scale OpenStack deployments. Historically, Rackspace has earned big fees from customers who sign "dedicated hosting" agreements, whereby the client owns the equipment and Rackspace provides space, power, and support. That's no longer the key driver in this business. Instead, Rackspace believes it can deliver the same high-touch service via what it calls a "managed cloud" offering hosted on its OpenStack platform. Are big clients buying the pitch? Look for an update on the number of high-dollar "managed cloud" deals during the earnings conference call.

4. An update on the "Solve" summits. Rackspace is fond of saying that, when it gets the chance to argue for its higher-touch brand of cloud computing, customers buy. But that doesn't happen enough when headlines scream of price wars between Amazon.com, Google, and others. Rackspace's answer? "Solve" summits hosted around the country and led by existing Rackspace clients. Look for an update on how this investment is paying off.

Rackspace Hosting reports Q3 results Monday after the market closes; check back here then for our take on the report. And in the meantime, leave a comment to let us know what you're expecting, and what you think of Rackspace stock at current prices.

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 (A and C class) 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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