Rackspace Technology (NASDAQ:RXT) vs. Grindr (NYSE:GRND) Head to Head Analysis

Rackspace Technology (NASDAQ:RXT) and Grindr (NYSE:GRND) are both business services companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, earnings, dividends and risk.

Profitability

This table compares Rackspace Technology and Grindr’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rackspace Technology	-28.79%	N/A	-1.55%
Grindr	-25.67%	-234.28%	7.68%

Valuation & Earnings

This table compares Rackspace Technology and Grindr”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rackspace Technology	$2.96 billion	0.21	-$837.80 million	($3.72)	-0.74
Grindr	$259.69 million	10.16	-$55.77 million	($0.44)	-34.07

Grindr has lower revenue, but higher earnings than Rackspace Technology. Grindr is trading at a lower price-to-earnings ratio than Rackspace Technology, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Rackspace Technology has a beta of 1.97, meaning that its stock price is 97% more volatile than the S&P 500. Comparatively, Grindr has a beta of 0.33, meaning that its stock price is 67% less volatile than the S&P 500.

Insider & Institutional Ownership

82.5% of Rackspace Technology shares are held by institutional investors. Comparatively, 7.2% of Grindr shares are held by institutional investors. 2.0% of Rackspace Technology shares are held by insiders. Comparatively, 76.4% of Grindr shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for Rackspace Technology and Grindr, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rackspace Technology	1	4	1	0	2.00
Grindr	0	0	3	0	3.00

Rackspace Technology currently has a consensus price target of $2.34, suggesting a potential downside of 15.16%. Grindr has a consensus price target of $17.67, suggesting a potential upside of 17.86%. Given Grindr’s stronger consensus rating and higher probable upside, analysts clearly believe Grindr is more favorable than Rackspace Technology.

Summary

Grindr beats Rackspace Technology on 9 of the 14 factors compared between the two stocks.

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.

About Grindr

Grindr Inc. operates social network and dating application for the lesbian, gay, bisexual, transgender, and queer (LGBTQ) communities worldwide. Its platform enables LGBTQ people to find and engage with each other, share content and experiences, and express themselves. The company offers ad-supported service and a premium subscription version. Grindr Inc. was founded in 2009 and is headquartered in West Hollywood, California.