Everspin Tech (NASDAQ:MRAM – Get Free Report) and Rackspace Technology (NASDAQ:RXT – Get Free Report) are both small-cap business services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, risk, dividends, institutional ownership, analyst recommendations, profitability and earnings.
Institutional and Insider Ownership
44.7% of Everspin Tech shares are owned by institutional investors. Comparatively, 82.5% of Rackspace Technology shares are owned by institutional investors. 6.3% of Everspin Tech shares are owned by company insiders. Comparatively, 2.9% of Rackspace Technology shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Everspin Tech and Rackspace Technology’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Everspin Tech | 0.50% | 4.78% | 3.93% |
| Rackspace Technology | -5.41% | N/A | -1.55% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Everspin Tech | 1 | 0 | 1 | 0 | 2.00 |
| Rackspace Technology | 1 | 2 | 0 | 0 | 1.67 |
Everspin Tech currently has a consensus price target of $18.50, suggesting a potential downside of 21.81%. Rackspace Technology has a consensus price target of $1.95, suggesting a potential downside of 58.51%. Given Everspin Tech’s stronger consensus rating and higher probable upside, research analysts plainly believe Everspin Tech is more favorable than Rackspace Technology.
Risk and Volatility
Everspin Tech has a beta of 1.87, meaning that its share price is 87% more volatile than the S&P 500. Comparatively, Rackspace Technology has a beta of 3.03, meaning that its share price is 203% more volatile than the S&P 500.
Valuation & Earnings
This table compares Everspin Tech and Rackspace Technology”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Everspin Tech | $55.20 million | 10.05 | -$590,000.00 | $0.01 | 2,366.00 |
| Rackspace Technology | $2.69 billion | 0.44 | -$225.80 million | ($0.61) | -7.70 |
Everspin Tech has higher earnings, but lower revenue than Rackspace Technology. Rackspace Technology is trading at a lower price-to-earnings ratio than Everspin Tech, indicating that it is currently the more affordable of the two stocks.
Summary
Everspin Tech beats Rackspace Technology on 11 of the 14 factors compared between the two stocks.
About Everspin Tech
Everspin Technologies, Inc. engages in the manufacture and sale of magnetoresistive random access memory (MRAM) products in the United States, Japan, Hong Kong, Germany, Singapore, China, Canada, and internationally. It offers Toggle MRAM, spin-transfer torque MRAM, and tunnel magneto resistance sensor products, as well as foundry services for MRAM products. The company provides its products for applications, including industrial, medical, automotive/transportation, aerospace, and data center markets. It serves original equipment manufacturers, contract manufacturers, and original design manufacturers through a direct sales channel, and a network of representatives and distributors. Everspin Technologies, Inc. was incorporated in 2008 and is headquartered in Chandler, Arizona.
About Rackspace Technology
Rackspace Technology, Inc. operates as a multi cloud technology services company in the Americas, Europe, the Middle East, Africa, and The Asia-Pacific region. It operates through three segments: Multicloud Services, Apps & Cross Platform, and OpenStack Public Cloud. The company provides public and private cloud managed services, which allow customers to determine, manage, and optimize the right infrastructure, platforms, and services; professional services related to designing and building multi cloud solutions and cloud-native applications; and managed hosting and colocation services. It also helps customers establish governance, operational, and architectural frameworks to mitigate risks and reduce inefficiencies to manage costs, achieve industry-specific compliance objectives, and enhance security. In addition, the company offers managed applications, including running large-scale SaaS applications for customers on its and public cloud infrastructure; managed security services in the areas of security threat assessment and prevention, threat detection and response, rapid remediation, governance, and risk and compliance assistance across multiple cloud platforms, as well as privacy and data protection services, including detailed access restrictions and reporting; data services; and professional services related to designing and implementing application, security, and data services. Rackspace Technology, Inc. was founded in 1998 and is headquartered in San Antonio, Texas.
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