What Makes Rackspace Technology (RXT) an Investment Choice?
Voss Capital, LLC , an investment management company, released its second-quarter 2026 investor letter. The letter can be downloaded here . Voss Capital's funds, Voss Value Fund, LP, and the Voss Value Offshore Fund, Ltd returned +22.4% and +23.2%, respectively, to investors net of fees and expenses, in the second quarter compared to a +21.5% return for the Russell 2000 Index, +17.2% return for the Russell 2000 Value Index, and +15.2% return for the S&P 500 Index. The Voss Value Master Fund's total gross exposure stood at 178.7%, and the delta-adjusted exposure was 100.6% as of June 30, 2026. The market is bifurcated between AI winners and others, with volatility driven largely by corporate earnings revisions. While hyperscaler investments surge, traditional sectors lag, and economic concentration poses risks. AI growth remains uncertain, as free cash flows shrink, potentially leading to market recalibrations amidst high-stakes competition. Also, check the fund's top five holdings to see its best picks in 2026.
In its second-quarter 2026 investor letter, Voss Capital highlighted Rackspace Technology, Inc. (NASDAQ: RXT ). Rackspace Technology, Inc. (NASDAQ:RXT) is a UK-based hybrid cloud and artificial intelligence solutions company. On August 27, 2026, Rackspace Technology, Inc. (NASDAQ:RXT) closed at $3.38 per share. Over the past month, Rackspace Technology, Inc. (NASDAQ:RXT) returned -18.16%, while its shares have gained 168.25% in the last 52 weeks. Rackspace Technology, Inc. (NASDAQ:RXT) has a market capitalization of $861.47 million, and its stock has traded within a 52-week range of $0.39 to $8.60.
Voss Capital stated the following regarding Rackspace Technology, Inc. (NASDAQ:RXT) in its Q2 2026 investor letter:
"We have initiated a small position in Rackspace Technology, Inc. (NASDAQ:RXT), a global managed service provider in both public and private cloud. RXT represents a classic high-leverage "stub" stock turnaround situation: a ~$900 million equity market cap ($3.42/share) resting atop a ~$3.8 billion enterprise value. The company carries ~$2.7 billion in net debt.x We think majority owner Apollo's ~51% stake, with an estimated ~$8.50/share cost basis, keeps management firmly aligned with minority equity holders.
Rackspace Technology, Inc. (NASDAQ:RXT) is not on our list of the 40 Most Popular Stocks Among Hedge Funds . As per our database, 22 hedge fund portfolios held Rackspace Technology, Inc. (NASDAQ:RXT) at the end of the second quarter, which was 8 in the previous quarter. While we acknowledge the potential of Rackspace Technology, Inc. (NASDAQ:RXT) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock .
In another article , we discussed Rackspace Technology, Inc. (NASDAQ:RXT) and highlighted best performing agentic AI stocks to buy. In addition, please check out our hedge fund investor letters Q2 2026 page for more investor letters from hedge funds and other leading investors.
READ NEXT: 33 Stocks That Should Double in 3 Years and 15 Stocks That Will Make You Rich in 10 Years .
