Rackspace Technology (NASDAQ:RXT) & Verify Smart (OTCMKTS:VSMR) Critical Analysis

Rackspace Technology (NASDAQ:RXT) and Verify Smart (OTCMKTS:VSMR) are both small-cap business services companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, valuation, dividends, risk and profitability.

Earnings & Valuation

This table compares Rackspace Technology and Verify Smart”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rackspace Technology	$2.74 billion	0.13	-$858.20 million	($1.62)	-0.94
Verify Smart	$220,000.00	35.23	N/A	N/A	N/A

Verify Smart has lower revenue, but higher earnings than Rackspace Technology.

Volatility & Risk

Rackspace Technology has a beta of 2.06, suggesting that its stock price is 106% more volatile than the S&P 500. Comparatively, Verify Smart has a beta of 2.11, suggesting that its stock price is 111% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Rackspace Technology and Verify Smart, as provided by MarketBeat.

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

Rackspace Technology currently has a consensus price target of $1.58, suggesting a potential upside of 3.62%. Given Rackspace Technology’s stronger consensus rating and higher probable upside, analysts clearly believe Rackspace Technology is more favorable than Verify Smart.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Rackspace Technology	-13.85%	N/A	-1.47%
Verify Smart	N/A	N/A	N/A

Institutional and Insider Ownership

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

Summary

Rackspace Technology beats Verify Smart on 5 of the 9 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 Verify Smart

Verify Smart Corp. provides wireless software solutions focused on IP fraud protection for secure authenticated transactions and celebrity services for fans interactions worldwide. The company's software solutions are delivered as Software as a Service model over the Internet, and allows its clients to access the company's application software and databases. Its products include VerifyNGo, which provides instant personal verification to combat fraud and identity theft through mobile device; and Prvii, a mobile communications service that enables celebrities to monetize their fan base via messaging channels. Verify Smart Corp. promotes its products and services across various markets, including consumer brands, financial services, sports/entertainment, governments, and educational institutions. The company was formerly known as Treasure Explorations Inc. and changed its name to Verify Smart Corp. in March 2009. Verify Smart Corp. was founded in 2006 and is based in Fernley, Nevada.