Rapid7 (RPD) AI Stock Analysis

• Market Cap: $1.01B
• Dividend Yield: N/A
• Average Volume (3M): 1.18M
• Price to Earnings (P/E): 44.8
• Beta (1Y): 1.09
• Revenue Growth: 3.08%
• EPS Growth: -54.07%
• Country: US
• Employees: 2,413
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.57
• Shares Outstanding: 65,480,774
• 10 Day Avg. Volume: 1,073,759
• 30 Day Avg. Volume: 1,180,168
• PEG Ratio: -0.85
• Price to Book (P/B): 142.21
• Price to Sales (P/S): 2.98
• P/FCF Ratio: 14.97
• Enterprise Value/Market Cap: 1.76
• Enterprise Value/Revenue: 2.08
• Enterprise Value/Gross Profit: 2.96
• Enterprise Value/Ebitda: 21.56
• 1Y Price Target: $19.33
• Price Target Upside: 20.36% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 19
• EPS Forecast (FY): 2.05
• Revenue Forecast (FY): $857.35M

• Rating: 49 Neutral
• Price Target: $15.50 ▼(-3.49% Downside)

Rapid7's overall stock score reflects strong revenue growth and a healthy gross profit margin, but is weighed down by low profitability and high leverage risks. The bearish technical indicators and high valuation further contribute to the cautious outlook.

Positive Factors

Strategic Partnerships

The partnership with HITRUST enhances Rapid7's compliance automation capabilities, potentially expanding its customer base and improving long-term competitive positioning in cybersecurity.

Revenue Growth

Strong revenue growth indicates robust market demand for Rapid7's cybersecurity solutions, supporting sustained business expansion and competitive advantage.

AI-Powered SOC Vision

Focusing on AI integration in security operations centers positions Rapid7 as a leader in advanced cybersecurity solutions, enhancing its long-term market relevance.

Negative Factors

High Leverage

High leverage increases financial risk, potentially limiting Rapid7's ability to invest in growth opportunities and weather economic downturns.

Low Profitability

Low profitability restricts Rapid7's ability to reinvest in its business and may hinder its capacity to improve operational efficiencies over time.

ARR Growth Challenges

Slower ARR growth could signal challenges in customer retention or acquisition, impacting long-term revenue stability and strategic goals.

Rapid7 Business Overview & Revenue Model

Company Description

Rapid7 (RPD) is a cybersecurity and data analytics company that specializes in helping organizations manage their security posture and respond to threats. With a focus on vulnerability management, application security, and incident detection and response, Rapid7 provides a suite of products that empower businesses to identify and mitigate risks in their IT environments. The company operates in sectors such as information technology, cybersecurity, and risk management, offering solutions that leverage advanced analytics and machine learning.

How the Company Makes Money

Rapid7 generates revenue primarily through subscription-based services, which include its cloud-based security solutions such as InsightVM for vulnerability management, InsightIDR for incident detection and response, and InsightAppSec for application security testing. The company also offers professional services, such as consulting and training, which contribute to its earnings. Key revenue streams include annual recurring revenue (ARR) from software subscriptions and one-time fees from professional services. Rapid7 has established partnerships with various technology vendors and resellers, enhancing its market reach and driving additional sales through integrated solutions and joint marketing efforts.

Rapid7 Financial Statement Overview

Summary

Rapid7 shows strong revenue growth and a healthy gross profit margin, indicating a solid market position. However, profitability remains a challenge with low net profit margins. The balance sheet shows high leverage, posing financial risks, while cash flow generation is moderate with limited flexibility.

Income Statement

Rapid7 has shown strong revenue growth with a TTM growth rate of 38.7%, indicating a robust upward trajectory. The gross profit margin remains healthy at 70.5%, reflecting efficient cost management. However, the net profit margin is relatively low at 2.2%, suggesting limited profitability. The EBIT and EBITDA margins have improved but remain modest, indicating room for operational efficiency improvements.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 7.63, indicating significant leverage and potential financial risk. The return on equity is strong at 66%, driven by improved net income, but the equity ratio is low, reflecting a reliance on debt financing. Overall, the balance sheet shows financial risk due to high leverage.

Cash Flow

Operating cash flow has improved, with a TTM operating cash flow to net income ratio of 0.34, showing better cash generation relative to earnings. However, free cash flow growth is negative, and the free cash flow to net income ratio is close to 1, indicating limited cash flow flexibility. The cash flow statement suggests moderate cash generation capabilities with some constraints.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	858.67M	844.01M	777.71M	685.08M	535.40M	411.49M
Gross Profit	602.89M	592.97M	545.97M	470.73M	366.46M	289.97M
EBITDA	82.83M	97.31M	-39.14M	-70.28M	-88.12M	-50.09M
Net Income	18.77M	25.53M	-149.26M	-124.72M	-146.33M	-98.85M
Balance Sheet
Total Assets	1.67B	1.65B	1.51B	1.36B	1.30B	913.12M
Cash, Cash Equivalents and Short-Term Investments	407.13M	521.71M	383.17M	291.45M	223.43M	312.46M
Total Debt	970.78M	1.02B	1.02B	914.34M	912.56M	463.94M
Total Liabilities	1.54B	1.63B	1.62B	1.48B	1.42B	841.59M
Stockholders Equity	127.22M	17.71M	-118.18M	-120.07M	-126.00M	71.54M
Cash Flow
Free Cash Flow	167.68M	168.25M	99.91M	57.82M	44.91M	-8.91M
Operating Cash Flow	179.62M	171.67M	104.28M	78.20M	53.92M	4.89M
Investing Cash Flow	-239.22M	-46.52M	-178.75M	-39.99M	-325.38M	-156.29M
Financing Cash Flow	-41.64M	5.58M	79.60M	7.42M	264.13M	200.93M

Rapid7 Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 16.06
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RPD, the sentiment is Negative. The current price of 16.06 is above the 20-day moving average (MA) of 14.44, below the 50-day MA of 17.00, and below the 200-day MA of 22.11, indicating a neutral trend. The MACD of -0.43 indicates Negative momentum. The RSI at 54.63 is Neutral, neither overbought nor oversold. The STOCH value of 83.21 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RPD.

Rapid7 Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
QLYS	78 Outperform	$5.23B	28.24	38.64%	―	9.95%	12.72%
OKTA	62 Neutral	$14.22B	95.08	2.96%	―	12.12%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
CYBR	52 Neutral	$23.10B	―	-12.73%	―	43.26%	-1651.82%
RPD	49 Neutral	$1.01B	44.76	37.09%	―	3.08%	-54.07%
VRNS	48 Neutral	$3.77B	―	-22.17%	―	11.37%	-34.44%
RBRK	48 Neutral	$13.70B	―	―	―	47.72%	61.95%

Rapid7 Corporate Events

Rapid7’s Earnings Call: Strong Gains Amid Challenges

Rapid7’s Earnings Call Reflects Strong Performance Amid Challenges

Rapid7 Inc. Reports Modest Growth in Q3 2025

Rapid7 Inc., a prominent player in the cybersecurity sector, specializes in threat detection and exposure management, providing integrated security solutions to over 11,000 global customers.

Rapid7 Appoints Rafe Brown as New CFO

Rapid7 announced the appointment of Rafe Brown as its new Chief Financial Officer, effective December 1, 2025, succeeding Tim Adams who will retire but remain in an advisory role during the transition. This leadership change comes as Rapid7 reported its third-quarter 2025 financial results, highlighting a 2% year-over-year increase in both annualized recurring revenue and total revenue, with the company positioning itself to leverage growing demand in the security operations market.

The most recent analyst rating on (RPD) stock is a Hold with a $19.50 price target. To see the full list of analyst forecasts on Rapid7 stock, see the RPD Stock Forecast page.

Rapid7 Q2 Earnings Call: Balanced Growth Amid Challenges

The recent earnings call for Rapid7 Inc. presented a balanced sentiment, highlighting robust performance in ARR and free cash flow, while acknowledging challenges like customer spending scrutiny and extended deal cycles. The detection and response segment continues to show healthy growth, but a narrowed ARR guidance reflects cautious optimism.

Rapid7 Reports Steady Growth in Q2 2025 Earnings

Rapid7 Inc., a prominent player in the cybersecurity industry, specializes in threat detection and exposure management, providing integrated solutions to enhance security outcomes for over 11,000 global customers. The company, headquartered in Boston, MA, recently released its financial results for the second quarter of 2025, showcasing steady growth in its annualized recurring revenue (ARR) and total revenue.