Comparing MBG (OTCMKTS:MBGH) and Rackspace Technology (NASDAQ:RXT)

Rackspace Technology (NASDAQ:RXT) and MBG (OTCMKTS:MBGH) are both technology companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.

Institutional and Insider Ownership

82.5% of Rackspace Technology shares are held by institutional investors. Comparatively, 27.1% of MBG shares are held by institutional investors. 2.3% of Rackspace Technology shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations for Rackspace Technology and MBG, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rackspace Technology	1	1	0	0	1.50
MBG	0	0	0	0	0.00

Rackspace Technology presently has a consensus price target of $4.00, indicating a potential upside of 24.22%. Given Rackspace Technology’s stronger consensus rating and higher probable upside, research analysts clearly believe Rackspace Technology is more favorable than MBG.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rackspace Technology	$2.69 billion	0.31	-$225.80 million	($0.65)	-4.95
MBG	N/A	N/A	N/A	($0.33)	-0.01

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Rackspace Technology	-5.88%	N/A	-1.81%
MBG	N/A	N/A	N/A

Summary

Rackspace Technology beats MBG 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 MBG

MBG Holdings Inc. provides IT and network lifecycle solutions from deployment to decommissioning. The company was formerly known as American Metals Recovery and Recycling Inc. The company is headquartered in Austin, Texas. MBG Holdings Inc. operates as a subsidiary of Multiband Global Resources, LLC.