Rapid7 (NASDAQ:RPD) Shares Down 7% - Should You Sell?

Key Points

• Rapid7 shares fell 7% to about $16.45 in mid-day trading, despite trading above the company’s 50-day and 200-day moving averages.
• Analyst sentiment remains cautious: 17 analysts rate the stock Hold and five rate it Sell, producing an average “Reduce” rating and a $12.09 price target—well below the trading price.
• Rapid7 beat quarterly expectations with $0.44 in EPS versus $0.35 expected and $210.88 million in revenue, but revenue declined 1.5% year over year; institutional investors own 95.66% of the shares.

Rapid7, Inc. (NASDAQ:RPD - Get Free Report) dropped 7% during mid-day trading on Thursday. The company traded as low as $16.50 and last traded at $16.4490. 836,662 shares were traded during mid-day trading, a decline of 60% from the average session volume of 2,098,758 shares. The stock had previously closed at $17.68.

Analysts Set New Price Targets

A number of research analysts recently issued reports on RPD shares. Jefferies Financial Group restated a "hold" rating and set a $12.00 target price on shares of Rapid7 in a research report on Tuesday, August 11th. Piper Sandler raised their price objective on shares of Rapid7 from $8.00 to $12.00 and gave the stock a "neutral" rating in a research note on Tuesday, August 11th. UBS Group raised their price target on shares of Rapid7 from $7.00 to $12.00 and gave the company a "neutral" rating in a research report on Tuesday, August 11th. Canaccord Genuity Group boosted their price objective on Rapid7 from $7.00 to $14.00 and gave the company a "hold" rating in a research report on Tuesday, August 11th. Finally, Robert W. Baird upped their target price on shares of Rapid7 from $8.00 to $10.00 and gave the stock a "neutral" rating in a report on Tuesday, August 11th. One analyst has rated the stock with a Buy rating, seventeen have assigned a Hold rating and five have given a Sell rating to the company's stock. Based on data from MarketBeat.com, Rapid7 currently has an average rating of "Reduce" and an average target price of $12.09.

Rapid7 Stock Performance

The stock has a fifty day moving average price of $12.70 and a 200-day moving average price of $9.50. The firm has a market cap of $1.10 billion, a price-to-earnings ratio of 52.84 and a beta of 1.02. The company has a quick ratio of 0.80, a current ratio of 0.80 and a debt-to-equity ratio of 1.50.

Rapid7 (NASDAQ:RPD - Get Free Report) last announced its quarterly earnings results on Monday, August 10th. The technology company reported $0.44 earnings per share for the quarter, beating analysts' consensus estimates of $0.35 by $0.09. Rapid7 had a return on equity of 27.89% and a net margin of 2.35%. The business had revenue of $210.88 million during the quarter, compared to analysts' expectations of $208.23 million. During the same quarter last year, the business posted $0.58 earnings per share. The business's revenue for the quarter was down 1.5% on a year-over-year basis. Rapid7 has set its Q3 2026 guidance at 0.440-0.470 EPS. On average, analysts expect that Rapid7, Inc. will post 0.76 earnings per share for the current fiscal year.

Institutional Investors Weigh In On Rapid7

A number of institutional investors have recently added to or reduced their stakes in RPD. Bank of America Corp DE bought a new position in Rapid7 in the 2nd quarter valued at about $6,861,000. Bank of New York Mellon Corp acquired a new stake in shares of Rapid7 in the second quarter worth $3,844,000. Man Group plc bought a new position in Rapid7 during the second quarter worth $3,409,000. Pacer Advisors Inc. raised its stake in shares of Rapid7 by 24.3% in the first quarter. Pacer Advisors Inc. now owns 469,912 shares of the technology company's stock valued at $2,589,000 after purchasing an additional 91,905 shares in the last quarter. Finally, Hsbc Holdings PLC increased its stake in Rapid7 by 274.1% in the fourth quarter. Hsbc Holdings PLC now owns 159,688 shares of the technology company's stock valued at $2,446,000 after acquiring an additional 117,000 shares during the period. Hedge funds and other institutional investors own 95.66% of the company's stock.

About Rapid7

Rapid7, Inc NASDAQ: RPD is a cybersecurity company that provides technology and services to help organizations identify, assess and manage security risk across their IT environments. Its offerings are designed to support security operations, vulnerability management, cloud security, application security and incident response.

The company's product portfolio includes the Insight platform and solutions such as InsightVM for vulnerability risk management, InsightIDR for security detection and response, InsightCloudSec for cloud security and compliance, and InsightAppSec for application security testing.

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