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

Key Points

• Rapid7 shares gapped down at the open, moving from a prior close of $11.48 to an opening price of $11.02 and last trading near $11.21. The stock was down about 2% on the session.
• Analyst sentiment remains cautious: several firms have cut price targets or downgraded the stock, and MarketBeat shows a consensus rating of “Reduce” with an average price target of $8.71.
• The company recently beat quarterly earnings expectations with EPS of $0.36 versus $0.30 expected and slightly topped revenue estimates, but revenue was still down year over year and analysts forecast full-year EPS of 0.63.

Rapid7, Inc. (NASDAQ:RPD - Get Free Report) shares gapped down before the market opened on Thursday . The stock had previously closed at $11.48, but opened at $11.02. Rapid7 shares last traded at $11.21, with a volume of 581,102 shares traded.

Analysts Set New Price Targets

A number of research firms have commented on RPD. DA Davidson raised their price target on shares of Rapid7 from $5.25 to $6.50 and gave the stock an "underperform" rating in a report on Tuesday, June 2nd. JPMorgan Chase & Co. dropped their target price on shares of Rapid7 from $11.00 to $7.00 and set a "neutral" rating on the stock in a research report on Monday, May 11th. William Blair cut shares of Rapid7 from an "outperform" rating to a "market perform" rating in a research note on Tuesday, April 28th. Canaccord Genuity Group cut their price target on Rapid7 from $10.00 to $7.00 and set a "hold" rating for the company in a research note on Wednesday, May 6th. Finally, Stifel Nicolaus decreased their price objective on Rapid7 from $9.00 to $7.00 and set a "hold" rating for the company in a report on Wednesday, May 6th. One investment analyst has rated the stock with a Buy rating, eighteen have issued a Hold rating and three have given a Sell rating to the company. According to data from MarketBeat, the company currently has an average rating of "Reduce" and a consensus price target of $8.71.

Rapid7 Stock Down 2.0%

The company has a debt-to-equity ratio of 1.69, a current ratio of 0.78 and a quick ratio of 0.78. The company has a market cap of $752.10 million, a PE ratio of 32.08 and a beta of 1.01. The company has a fifty day moving average price of $7.42 and a 200 day moving average price of $8.54.

Rapid7 (NASDAQ:RPD - Get Free Report) last posted its quarterly earnings data on Tuesday, May 5th. The technology company reported $0.36 earnings per share for the quarter, beating the consensus estimate of $0.30 by $0.06. Rapid7 had a net margin of 2.61% and a return on equity of 34.35%. The firm had revenue of $209.69 million for the quarter, compared to analysts' expectations of $207.94 million. During the same quarter last year, the company posted $0.49 EPS. The business's quarterly revenue was down .3% on a year-over-year basis. Rapid7 has set its FY 2026 guidance at 1.520-1.600 EPS and its Q2 2026 guidance at 0.330-0.360 EPS. As a group, analysts anticipate that Rapid7, Inc. will post 0.63 EPS for the current year.

Hedge Funds Weigh In On Rapid7

A number of large investors have recently added to or reduced their stakes in the business. Parallel Advisors LLC increased its holdings in shares of Rapid7 by 108.8% in the first quarter. Parallel Advisors LLC now owns 6,340 shares of the technology company's stock worth $35,000 after buying an additional 3,304 shares during the period. Sound Income Strategies LLC purchased a new position in Rapid7 during the 4th quarter valued at $40,000. CI Investments Inc. raised its stake in Rapid7 by 48.4% in the third quarter. CI Investments Inc. now owns 2,281 shares of the technology company's stock worth $43,000 after buying an additional 744 shares in the last quarter. Headlands Technologies LLC purchased a new position in shares of Rapid7 in the 2nd quarter valued at approximately $44,000. Finally, GAMMA Investing LLC lifted its position in Rapid7 by 20.6% during the second quarter. GAMMA Investing LLC now owns 5,866 shares of the technology company's stock valued at $48,000 after buying an additional 1,000 shares during the period. Hedge funds and other institutional investors own 95.66% of the company's stock.

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.

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