Out Fox The $treet

After the 50% plunge in Rackspace Hosting (NYSE: RAX ) , one has to wonder what is holding Equinix (NASDAQ: EQIX ) up near all-time highs. The stock has shown some fatigue since the Rackspace disappointment, but it appears now set for a test of the recent highs over the $230 level. Not a scenario suggestive of a stock on the verge of a plunge. A leader in the data collocation field, Equinix more » Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Prior to the open on Wednesday, SodaStream (SODA) posted earnings that handily beat analyst estimates and initially sent the stock soaring nearly 10% in pre market trading. Revenues soared 49% year-over-year and net income soared 43% from last year. The company is a leading manufacturer of home beverage carbonation systems. Even though the company also raised guidance, the stock ended the trading day in negative territory. Read the full article at Seeking Alpha. Disclosure: Long SODA. Please review the disclaimer page for more details. 

After the close on Tuesday, Rackspace Hosting (RAX) posted earnings that beat analyst estimates and sent the stock soaring over 11% in after hours trading. Revenues jumped 29% year-over-year and net income soared 43% from last year. The company is a leading provider of public and private cloud and hybrid and dedicated hosting services. It delivers open technologies and powers more than 190,000 customers worldwide Unfortunately though for a company with a market cap of $6.6B, it continues to report relatively low free cash flows. This quarter the total free cash flow was only $28.7M or just over $100M on a annualized basis. Read the full article on Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

As a telecom industry veteran, I'm all too familiar with companies that build data centers and networks for the future. All too often, service providers spent billions on networks that needed to be upgraded by the time they were installed. These companies always promised huge earnings in the future. Massive free cash flows were always around the corner once this feature was added or this connection made. Unfortunately, the competition always had the same plan leading to quick margin erosion and evaporating profits. While reading the Q4'11 earnings conference call transcript for Equinix (EQIX) , this statement in the opening remarks by CEO Stephen Smith got me thinking back to the internet bubble years. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

How did I forget Terremark Worldwide (TMRK) on previous post discussing 52 week high stocks in our portfolios. TMRK is a leading investment in both the Opportunistic and Growth Portfolios. Ironically this stock hit a 52 week high back in August, then sold off big time. Whether this will be a breakout this time or eventually fail is still up for debate. TMRK is caught up in the 'cloud computing' craze as it is a prime provide of cloud services in its data centers. Its interesting to note that Rackspace Hosting (RAX) is also breaking out today which has been unusual for these 2 stocks to trade in tandem. So much for the market trading in a herd and stock picking going out the window. RAX on the other hand hasn't broken its high from the beginning of the year. Its a much bigger company so potentially TMRK is being seen by the market has a takeover candidate. Both stocks and especially TMRK has become overbought and likely needs to take...