Rapid7 (NASDAQ:RPD) Shares Down 6.6% – Time to Sell?

Rapid7, Inc. (NASDAQ:RPD)’s share price dropped 6.6% on Wednesday . The company traded as low as $11.69 and last traded at $12.5030. Approximately 369,267 shares traded hands during mid-day trading, a decline of 83% from the average session volume of 2,162,021 shares. The stock had previously closed at $13.38.

Rapid7 News Summary

Here are the key news stories impacting Rapid7 this week:

• Positive Sentiment: Second-quarter results exceeded expectations. Rapid7 reported adjusted EPS of $0.44, above the $0.35 consensus estimate, while revenue of $210.9 million modestly topped expectations of $208.2 million. The company also generated $37 million in operating cash flow and ended the quarter with $425.6 million in cash. Rapid7 second-quarter earnings report
• Positive Sentiment: Profit guidance was raised relative to consensus. Rapid7 expects third-quarter adjusted EPS of $0.44-$0.47, well above analysts’ $0.38 estimate. Analysts subsequently lifted their price targets, reflecting improved confidence in the company’s earnings execution. Rapid7 analyst forecast revisions
• Positive Sentiment: AI governance concerns may support demand for cybersecurity services. New Rapid7-Omdia research found executives are 1.6 times more likely than operational security managers to be highly concerned about vendors’ handling of security data. The findings reinforce the need for governed, trusted AI security solutions, although the announcement does not include a new contract or financial forecast. Rapid7-Omdia AI governance research
• Neutral Sentiment: Analyst targets increased but ratings remain cautious. JPMorgan, Stephens and Baird raised their targets to $12, yet each maintained a neutral or equal-weight rating, leaving targets below the prevailing share price.
• Negative Sentiment: Growth remains weak and guidance is mixed. Second-quarter revenue fell roughly 1.5% year over year, and third-quarter revenue guidance of $208 million-$210 million is slightly below the $210.5 million consensus. EPS also declined from $0.58 a year earlier, increasing concerns that the earnings beat reflects cost control more than renewed demand.

Wall Street Analysts Forecast Growth

Several equities research analysts have recently commented on the stock. Barclays boosted their target price on shares of Rapid7 from $6.50 to $12.00 and gave the stock an “underweight” rating in a research report on Tuesday. DA Davidson lifted their price target on Rapid7 from $5.25 to $9.00 and gave the company an “underperform” rating in a research note on Tuesday. JPMorgan Chase & Co. boosted their price objective on Rapid7 from $7.00 to $12.00 and gave the stock a “neutral” rating in a report on Tuesday. Stephens reissued a “positive” rating on shares of Rapid7 in a research note on Tuesday. Finally, Stifel Nicolaus raised their target price on Rapid7 from $7.00 to $13.00 and gave the company a “hold” rating in a report on Tuesday. One research analyst has rated the stock with a Buy rating, eighteen have given a Hold rating and four have issued a Sell rating to the stock. According to MarketBeat.com, the company currently has a consensus rating of “Reduce” and a consensus price target of $11.98.

Rapid7 Price Performance

The company has a quick ratio of 0.78, a current ratio of 0.78 and a debt-to-equity ratio of 1.69. The business’s 50-day moving average is $9.34 and its two-hundred day moving average is $7.96. The company has a market capitalization of $846.74 million, a P/E ratio of 40.87 and a beta of 0.97.

Rapid7 (NASDAQ:RPD) last released its quarterly earnings results on Monday, August 10th. The technology company reported $0.44 earnings per share for the quarter, topping the consensus estimate of $0.35 by $0.09. Rapid7 had a net margin of 2.35% and a return on equity of 29.93%. The business had revenue of $210.88 million for the quarter, compared to analysts’ expectations of $208.23 million. During the same period in the previous year, the company earned $0.58 earnings per share. The firm’s revenue for the quarter was down 1.5% compared to the same quarter last year. Rapid7 has set its Q3 2026 guidance at 0.440-0.470 EPS. As a group, analysts predict that Rapid7, Inc. will post 0.63 earnings per share for the current year.

Hedge Funds Weigh In On Rapid7

Several institutional investors have recently modified their holdings of RPD. Parallel Advisors LLC increased its position in shares of Rapid7 by 108.8% during the first quarter. Parallel Advisors LLC now owns 6,340 shares of the technology company’s stock valued at $35,000 after acquiring an additional 3,304 shares during the last quarter. Allworth Financial LP purchased a new position in Rapid7 in the second quarter worth $42,000. Headlands Technologies LLC purchased a new position in Rapid7 in the second quarter worth $44,000. GAMMA Investing LLC grew its stake in Rapid7 by 20.6% in the 2nd quarter. GAMMA Investing LLC now owns 5,866 shares of the technology company’s stock valued at $48,000 after purchasing an additional 1,000 shares during the period. Finally, KBC Group NV grew its stake in Rapid7 by 124.0% in the 4th quarter. KBC Group NV now owns 3,310 shares of the technology company’s stock valued at $50,000 after purchasing an additional 1,832 shares during the period. 95.66% of the stock is owned by institutional investors.

Rapid7 Company Profile

Rapid7, Inc is a publicly traded cybersecurity company headquartered in Boston, Massachusetts. Since its founding in 2000, the company has specialized in delivering cloud-based security data and analytics solutions designed to help organizations detect, investigate, and remediate cyber threats. Rapid7 operates under the NASDAQ symbol “RPD” and serves a broad range of industries, including technology, financial services, healthcare, retail, and the public sector.

The core of Rapid7’s offering is its Insight platform, a unified, cloud-native security operations and analytics suite.