Complete RXT Stock Valuation Analysis
Comprehensive intrinsic value analysis using 2 different methodologies
RXT DCF Analysis
RXT (Rackspace Technology, Inc.) discounted cash flow analysis with multiple scenarios, growth assumptions, and terminal value calculations
Financial Projections
| Metrics | 2022 (Historical) | 2023 (Historical) | 2024 (Historical) | 2025 (Projected) | 2026 (Projected) | 2027 (Projected) | 2028 (Projected) | 2029 (Projected) |
|---|---|---|---|---|---|---|---|---|
| Revenue | $3.1B | $3.0B | $2.7B | $2.7B | $2.6B | $2.5B | $2.5B | $2.4B |
| Revenue Growth % | - | -5.3% | -7.4% | -2.7% | -2.4% | -2.2% | -2.0% | -1.8% |
| EBIT | $-8.4M | $-899.4M | $-909.1M | $133.2M | $129.9M | $127.1M | $124.6M | $122.4M |
| EBIT Margin % | -0.3% | -30.4% | -33.2% | 5.0% | 5.0% | 5.0% | 5.0% | 5.0% |
| Tax Rate % | 25.0% | 25.0% | 25.0% | 25.0% | 25.0% | 25.0% | 25.0% | 25.0% |
| NOPAT | $-6.3M | $-674.5M | $-681.8M | $99.9M | $97.4M | $95.3M | $93.4M | $91.8M |
| NOPAT Margin % | -0.2% | -22.8% | -24.9% | 3.8% | 3.8% | 3.8% | 3.8% | 3.8% |
| Capex | $80.4M | $96.9M | $111.1M | $94.9M | $88.0M | $81.7M | $76.1M | $71.0M |
| Capex / Revenue % | 2.6% | 3.3% | 4.1% | 3.6% | 3.4% | 3.2% | 3.1% | 2.9% |
| Depreciation | $447.6M | $442.9M | $363.0M | $378.0M | $368.8M | $360.7M | $353.6M | $347.4M |
| D&A / Revenue % | 14.3% | 15.0% | 13.3% | 14.2% | 14.2% | 14.2% | 14.2% | 14.2% |
| Change in NWC | $64.6M | $-278.1M | $-86.4M | $-31.9M | $-24.9M | $-19.5M | $-15.3M | $-12.0M |
| NWC Change / Revenue % | 2.1% | -9.4% | -3.2% | -1.2% | -1.0% | -0.8% | -0.6% | -0.5% |
| Unlevered FCF | $296.3M | $-50.5M | $-343.5M | $414.8M | $403.1M | $393.8M | $386.2M | $380.1M |
| UFCF % Chg. | - | -117.0% | -580.9% | 220.7% | -2.8% | -2.3% | -1.9% | -1.6% |
| FCF / Revenue % | 9.5% | -1.7% | -12.6% | 15.6% | 15.5% | 15.5% | 15.5% | 15.5% |
| Discount Factor | - | - | - | 0.945 | 0.893 | 0.844 | 0.798 | 0.754 |
| Present Value of FCF | - | - | - | $392.0M | $360.0M | $332.3M | $308.0M | $286.5M |
| Sum of PV of UFCF | - | - | - | $392.0M | $752.0M | $1.1B | $1.4B | $1.7B |
WACC Calculation
Weighted Average Cost of Capital used for discounting cash flows.
| WACC Calculation | Value |
|---|---|
| Cost of Debt | 6.9% |
| Tax Rate | 25.0% |
| After Tax Cost of Debt | 5.2% |
| Risk Free Rate | 4.38% |
| Market Risk Premium | 4.3% |
| Beta | 2.06 |
| Cost of Equity | 13.3% |
| Total Debt | $3.3B |
| Market Cap | $288.4M |
| Total Capital | $3.6B |
| Debt Weighting | 91.9% |
| Equity Weighting | 8.1% |
| WACC | 5.8% |
Terminal Value
Choose between perpetuity growth or exit multiple methods.
| Terminal Value Calculation | Value |
|---|---|
| Terminal Growth Rate | 2.5% |
| Final Year FCF | $380.1M |
| Terminal Value | $11.7B |
| PV of Terminal Value | $8.8B |
| Cumulative PV of UFCF | $1.7B |
| Net Debt | $3.1B |
| Equity Value | $7.4B |
| Shares Outstanding | 224.8M |
| Implied Share Price | $33 |
| Current Share Price | $1 |
| Implied Upside/(Downside) | +2604.8% |
Valuation Summary
$32.86
Implied Price
$1.22
Current Price
+2604.8%
Upside/Downside
5.8%
WACC
RXT Peer Valuation Analysis
Relative valuation based on comparable company trading multiples
Peer Valuation Analysis
Fair Value Range Analysis
Based on median multiples from 10 peer companies in Technology
P/E Ratio
$-90.80
-7573.5%
Peer Median: 72.8x
EV/EBITDA
$8.39
+590.3%
Peer Median: 24.9x
P/S Ratio
$23.99
+1874.5%
Peer Median: 2.1x
Interpretation: Each multiple provides a different perspective on fair value. Consider which multiple is most relevant for RXT's business model and current situation.
Multiple Comparison
| Multiple | RXT Current | Peer Median | Peer Average | Premium/Discount | Assessment |
|---|---|---|---|---|---|
| P/E Ratio | -1.0x | 72.8x | 72.8x | -101.3% | Undervalued |
| EV/EBITDA | 42.9x | 24.9x | 30.7x | 72.1% | Overvalued |
| P/S Ratio | 0.1x | 2.1x | 3.2x | -94.9% | Undervalued |
Peer Companies
Click any company to view their valuation
| Company | Market Cap | P/E Ratio | EV/EBITDA | P/S Ratio |
|---|---|---|---|---|
| $2.26B | 0.0x | 115.6x | 10.2x | |
| $0.99B | 0.0x | 0.0x | 1.8x | |
| $1.34B | 0.0x | 0.0x | 6.4x | |
| $0.38B | 0.0x | 0.0x | 1.1x | |
| $0.28B | 0.0x | 0.0x | 2.1x | |
| $0.29B | 0.0x | 42.9x | 0.1x | |
| $0.16B | 72.8x | 24.9x | 2.6x | |
| $0.03B | 0.0x | 0.0x | 25.0x | |
| $0.03B | 182.0x | 24.3x | 1.3x | |
| $74.82B | 0.0x | 0.0x | 20.6x |