Rackspace started trading today on the New York Stock Exchange. The ticker symbol is RAX. Initially San Antonio based Rackspace planned on raising 400 million, but due to market conditions, they ended up raising a total around $187 million at $12.50 a share. This would value the company around $1.45 billion. Goldman Sachs, Merrill Lynch and Credit Suisse were some of the underwriters of this offering.
Upon opening of the trading day, things did not go well for the new IPO, and the stock traded as low as $9.75. Seeing how poorly a well established company, with $362 million in revenue last year like RAX stock traded, should really have other companies looking to make the move onto an exchange thinking twice. The time is obviously not ripe for IPO’s. Now is the time to be fostering and building upon your current business, and not spending the fees associated with putting your company into the publics hands.
My experiences with Rackspace have been beyond exceptional. I recommend Rackspace to everyone I can, since I am confident their support is the best. Rackspace claims they give fanatical service, and fanatical might be an understatement to use. 24/7 there is someone there to help us. 24/7 there are responses to my tickets I leave to communicate with support. Even though Rackspace sometimes costs triple of some of their competitors, it is worth every penny extra to someone like me. One hour of downtime could cost more then any savings I would get using a competitor.
Rackspace recently moved to an entire shopping mall in San Antonio texas, with some grants from the local government. This facility will be used to house the thousands of employees rackspace has to service its over 33,000 customers. Unfortunately during my previous visit with them, I was unable to see the new million square foot facility, but hopefully this year when we head to SXSW, I can take the tour.
Hard for me to imagine a stock like this will keep going lower. With earnings and growth like Rackspace has, it seems the future is wide open for this company. Rackspace recently entered the cloud hosting arena with Mosso, which for $100.00 a month you get unlimited site hosting. Unlike many companies, Rackspace is obviously not sitting idle with their current technology and appear to be investing heavily into infrastructure and technology. Rackspace you have made me a cheerleader, and I am happy to be one of your customers on my personal sites.