Shares of Rackspace Hosting (NYSE: RAX ) fell more than 24% Thursday, leaving essentially no investors who believe this is one of the best stocks to invest in now.
Yet the skeptics may be overreaching. Sure, Rackspace's revenue growth is slowing, but with gross margin rising, concerns over collateral damage caused by an ongoing cloud storage price war between Amazon.com (NASDAQ: AMZN ) and Google (NASDAQ: GOOG ) are probably unjustified. In the video below, Fool contributor Tim Beyers of Motley Fool Rule Breakers and Motley Fool Supernova addresses these concerns.
Rackspace is down 47% year to date despite notable progress in implementing its OpenStack infrastructure, which should help to produce higher margins and profits over time. It'll take awhile for the transition to take full effect, but when it does, look out above, Tim says.
Do you agree? Watch the video to get Tim's full take, and then let us know whether you think Rackspace Hosting is one of the best stocks to invest in now.
The titans of tech
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Getty Images Knowing your credit score and knowing how to improve it are two of the most important things consumers can do ensure they reach their long-term goals. The three major credit rating agencies -- Experian (EXPN), TransUnion and Equifax -- collect information on all of us, looking at how we spend our money, pay our debts and mess up. They use that boatload of data to create your FICO score, which in turn is used by lenders to determine your credit risk. And that credit score can determine whether you will be turned down for a car loan -- or if you'll get the 0 percent interest incentive rate or if you'll have pay 18 percent. Here are 11 steps you can take -- and they may take a few months -- to repair any damage you've done. 1. Get Going The first thing is to review your credit report for accuracy. Mistakes can and do happen. Sometimes the information given to the credit agencies is simply wrong, and they don't fact-check unless you request it. Sometimes you're a victim of misidentification; perhaps someone with the same name fell behind on payments, and it ends up on your record. Each of the three credit agencies is obligated to provide you with a free report once a year. It's best to cycle through them every four months so you can regularly monitor the accuracy of the information. 2. React If you find an error on your credit report, immediately file a free dispute form with the credit agency. It is then required by federal law to attempt to validate the information by checking with the creditor who reported it in the first place. That creditor has 30 days to respond, and if it cannot do so, the matter should be resolved in your favor. And while you can remove wrong items from your credit report, don't expect to game the system and erase mistakes that you really did make. 3. Be Responsible This one is a no-brainer, but it may be the most important thing you can do: pay your bills on time. Greg McBride, chief financial analyst at Bankrate.com, calls it "the low-hanging fruit." Paying your bills on time and demonstrating responsible debt management over time accounts for two-thirds of your credit score. "If you're not doing that, it doesn't matter what else you do," said McBride. If you can't do that, at least make the minimum payment and preferably pay as much as you can. Missing a payment is a real black mark. 4. Avoid Deadly Sins Some mistakes will ding your credit score -- but others will demolish it. Bankruptcies, defaults on a mortgage, some unpaid tax liens and defaults on student loans stay on your record for 10 years or longer. Most other mistakes get erased in seven years, and they tend to fade in importance over time. McBride says "the passage of time works to your benefit. Recent events count more and carry more weight than the missteps" you made in years past. He adds that "a credit rating is like a reputation: it takes a long to build, but it's easy to destroy." 5. Manage Credit Cards If you are doing everything else right, think about card management. "Don't focus on the number of cards you have," says John Ulzheimer, credit expert at CreditSesame.com. "Focus on how you manage them." Your credit score is partly determined by what's known as the utilization rate. That's determined by dividing your outstanding balance by your credit limit. Ideally if you can keep that below 10 percent, it can boost your credit score, but letting it rise above 30 percent can work against you. Above all, don't max out on any cards. That is, don't spend 90 percent or more of your credit limit. Lenders tend to view this as irresponsible spending. 6. Get More Than One Lenders like to see two or more cards on your credit report. It shows that you are able to manage your spending responsibly. Ulzheimer says having multiple cards is like having credit score insurance because it can help to lower your utilization ratio -- but only if you're still able to pay them off in full each month. However, "if you use credit cards as a supplement to your income," he says "then you're not doing yourself any favors." If you have cards that you're no longer using, don't cancel them; just shred them. Closing an account reduces your utilization rate. 7. Ignore Store Come-Ons Chain stores lure you on with discounts (like 20 percent off your first purchase) if you apply for their store credit cards. Don't do it. It temporarily lowers your credit score each time you apply to open a new account. However, you're not punished for shopping around for a mortgage or car loan. McBride says the credit agencies assume that you're buying one home or one car if you submit more than one application within a 30-day period. 8. Ask, and You Shall Receive If your account is in good standing for at least six consecutive months, you can usually request a hike of $500 to $1,000 in your credit limit. This is a good way for young people who are starting to establish a credit history by improving their utilization ratio. Again, this comes with a warning: it only helps if you don't use the extra credit as a signal to spend more -- but it's there if you really need it. 9. Do the Math If your credit score is above 750, you're considered an elite borrower and usually eligible for a lender's best deal. But if your score is in the 600s, you may get the loan, but pay through the nose. Here's the difference: on a five-year car loan, a elite borrower might get a 0 percent deal, while the lower-rated borrower could pay as much as 18 percent. The difference adds up to thousands of dollars saved or lost. On credit cards, people with solid credit scores usually pay about 16 percent, while those with poor credit scores can be saddled with onerous annual percentage rates in the high 20s. There's a colossal difference in how much you'll pay in the long term. 10. Establish Credit Young people are often in a Catch-22 situation: you need a credit history to get a lender to extend you credit. But there are some things you can do. The first option is to become an authorized user on the credit card of your parents or a really, really good friend. This establishes a baseline credit history that will help when you apply for your own credit card. The credit card company holds the other person (parent or friend) responsible for the payment. If you mess this up by charging too much, it can hurt their' score. On the other hand, if you're responsible, you get the benefit of their good credit history. Another option is to get a secured card. You deposit as little as $300 with a bank that issues a card that has that much money available to spend. You can "refill" the card, and once you've established that you can handle your money, you can apply for a real credit card. 11. Plan If you're planning a big purchase -- a home or a car, for example -- work on these points three to six months ahead. "Every basis point of interest that you pay is real money," said Ulzheimer, suggesting that you also go on a credit hiatus by paying down cards as much as possible and avoiding any new debt. More from Drew Trachtenberg
) offers a dividend yield of 3.42% based on Friday’s closing price of $74.21 and the company's quarterly dividend payout of 63.5 cents. The stock is up 2.6%year-to-date. Dividend.com currently rates Erie as “Neutral” with a DARS™ rating of 3,4 stars out of 5 stars.
Richard Levine/AlamyWhen paying off student loans, tackle those with the highest interest rates first. If you are tired of having student loans hanging over your head, welcome to the crash course for debt elimination. Our syllabus is simple, the course objective has been plainly stated and grading will be based on a pass/fail basis. Let's begin. What's the rush? You may be wondering why we have defined such a short period of time to pay off a substantial debt. After all, The Institute for College Access & Success says the average student loan balance was $29,400, which is based on the latest data available for the class of 2012. With a supersized debt of that magnitude, you need a lot of time, right? Yes, but a lack of urgency can encourage complacency, and with time the debt will grow even larger. This may light a fire: Calculate the amount of interest you will pay by only making minimum payments on your student loans. If you can't put your hands on the statements for your loans, check the National Student Loan Data System to retrieve your loan information. It's quite likely you'll be surprised by the big number you discover. You might even find you'll be paying as much interest on your loans as the original principal amount. Putting a short fuse on the debt bomb will inspire a significant financial turnaround. Once you retire the student loans, imagine the boost to your cash flow. You might even feel affluent for a change. With those monthly payments gone, you can focus on buying a home, saving for retirement, paying for a wedding and all the other good things in life. No student loan debt means you can kiss Sallie Mae goodbye. You'll feel like a different person, with less stress and real financial freedom. Debt limits options. While the task may seem insurmountable, consider the Harvard University alum who paid off $90,000 in graduate school debt – in seven months. Joe Mihalic is a supply chain manager in Austin, Texas now, but three years ago he was deep in debt and desperate to get out. "I simply felt an overwhelming feeling of being trapped," Mihalic, author of "Destroy Student Debt: A Combat Guide to Freedom," wrote in an email. "I felt that the debt was severely limiting my options, and I realized I would never be truly free unless I became debt-free." By committing to a frugal lifestyle and squeezing every bit out of his annual salary, which was less than the balance on the loans, Mihalic accomplished his goal of rapid debt reduction. "I didn't start feeling weighed down by my debt until my self-esteem finally reached a level where I didn't need to constantly spend money to feel good about myself," he writes. "At that point, the negative feelings associated with my debt were greater than the positive feelings associated with consumption. Only then did I seek out a life of frugality and living below my means." A cash budget is key. And consider Jackie Ritz, a Paleo diet aficionado from North Carolina who blogs at ThePaleoMama.com. She and her husband paid off $50,000 worth of debt in 10 months. "We sat down one night and wrote down all of our debt, including our student loan debt, which was the most baggage," she wrote in an email. "My husband had carried his student loan debt the past 15 years, and we wondered how long we were going to let that debt keep following along with us. So in order to have financial freedom we knew we were going to have to be more aggressive in paying the student loans down and turn our minimum payments into the maximum amount we could manage in our budget." Ritz adds that sticking to a cash budget was the key. "During this time, we made a budget for all our expenses and used the 'envelope system'," she explains. "You place the week's worth of money in your envelopes and when the cash is out, it's out! This was probably the hardest part of it all since we were so used to swiping our debit or credit card without even thinking about a budget." A prerequisite. There is a prerequisite to this course. It is Paying Off Your Credit Card Debt 101. As much as you would like to rid yourself of the burden of college debt once and for all, if you have substantial credit card balances, they must be attended to first. The interest rate you pay on credit card debt is likely to be twice as much -- if not substantially more -- than what you pay on student loans. When you do tackle the student loans, pay off those with the highest interest rates first. That will save you money and allow each payment to reduce more principal. And before sending in a substantial payment to a lender, call first. Ensure the payment will be applied to the loan's principal – not to interest. Extreme debt reduction. In order to abolish $30,000 of student loans within three years, the payments will total $923.57, based on a 6.8 percent interest rate for 36 payments. You can nerd the numbers for your own debt situation. The strategy will be a combination of increasing your monthly income while reducing your monthly expenses to come up with the extra cash.