Critical Review: Rackspace Technology (NASDAQ:RXT) vs. FingerMotion (NASDAQ:FNGR)

FingerMotion (NASDAQ:FNGR) and Rackspace Technology (NASDAQ:RXT) are both small-cap business services companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, valuation, risk, institutional ownership and earnings.

Analyst Recommendations

This is a summary of current recommendations and price targets for FingerMotion and Rackspace Technology, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FingerMotion	0	0	0	0	0.00
Rackspace Technology	1	4	0	0	1.80

Rackspace Technology has a consensus price target of $1.5750, indicating a potential upside of 34.62%. Given Rackspace Technology’s stronger consensus rating and higher probable upside, analysts plainly believe Rackspace Technology is more favorable than FingerMotion.

Insider and Institutional Ownership

3.9% of FingerMotion shares are owned by institutional investors. Comparatively, 82.5% of Rackspace Technology shares are owned by institutional investors. 8.2% of FingerMotion shares are owned by insiders. Comparatively, 2.9% of Rackspace Technology shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

FingerMotion has a beta of -0.86, indicating that its stock price is 186% less volatile than the S&P 500. Comparatively, Rackspace Technology has a beta of 2.06, indicating that its stock price is 106% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
FingerMotion	-15.31%	-44.33%	-13.12%
Rackspace Technology	-13.85%	N/A	-1.47%

Valuation & Earnings

This table compares FingerMotion and Rackspace Technology”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FingerMotion	$35.61 million	2.37	-$5.11 million	($0.10)	-14.20
Rackspace Technology	$2.74 billion	0.10	-$858.20 million	($1.62)	-0.72

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

Summary

Rackspace Technology beats FingerMotion on 9 of the 13 factors compared between the two stocks.

About FingerMotion

FingerMotion, Inc., a mobile data specialist company, provides mobile payment and recharge platform system in China. The company offers telecommunication products and services, including data plans, subscription plans, mobile phones, and loyalty points redemption services; bulk short message service and multimedia messaging services; and Rich Communication Services (RCS) platform, a proprietary business messaging platform that enables businesses and brands to communicate and service their customers on the 5G infrastructure. It also operates Sapientus, a proprietary big data insights platform that deliver data-driven for businesses in the insurance, healthcare, and financial services industries. In addition, the company offers value added product and services. FingerMotion, Inc. is headquartered in Singapore.

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.