Rapid7 (NASDAQ:RPD) Shares Gap Up on Better-Than-Expected Earnings

Rapid7, Inc. (NASDAQ:RPD)’s share price gapped up prior to trading on Thursday after the company announced better than expected quarterly earnings. The stock had previously closed at $15.04, but opened at $17.25. Rapid7 shares last traded at $15.9120, with a volume of 440,490 shares.

The technology company reported $0.60 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.46 by $0.14. The company had revenue of $212.40 million during the quarter, compared to the consensus estimate of $209.05 million. Rapid7 had a return on equity of 27.89% and a net margin of 2.35%. Rapid7’s revenue for the quarter was down 2.5% on a year-over-year basis. During the same period in the previous year, the business earned $0.57 EPS.

Trending Headlines about Rapid7

Here are the key news stories impacting Rapid7 this week:

• Positive Sentiment: Rapid7 earned adjusted EPS of $0.60, topping estimates of $0.46, and generated $212.4 million in revenue versus forecasts of $209.05 million. The earnings and sales beats helped lift the stock after the report. Earnings results
• Neutral Sentiment: The company expects fourth-quarter adjusted EPS of $0.53 to $0.55. Whether that outlook is strong enough to sustain the post-earnings optimism depends on market expectations. Fourth-quarter outlook
• Neutral Sentiment: A Yahoo Finance article raises the question of whether Rapid7 remains overvalued after its results; the provided article details do not include a valuation conclusion. Valuation analysis
• Negative Sentiment: Despite beating estimates, quarterly revenue was down 2.5% year over year, a sign that growth remains a concern. Q3 earnings coverage

Wall Street Analysts Forecast Growth

Several brokerages have commented on RPD. Robert W. Baird increased their price target on shares of Rapid7 from $8.00 to $10.00 and gave the company a “neutral” rating in a research note on Tuesday, August 11th. Raymond James Financial restated an “outperform” rating and set a $15.00 price objective on shares of Rapid7 in a research report on Tuesday, August 11th. Stephens restated a “positive” rating on shares of Rapid7 in a report on Tuesday, August 11th. Citigroup reaffirmed a “neutral” rating on shares of Rapid7 in a research report on Wednesday, August 12th. Finally, Jefferies Financial Group reiterated a “hold” rating and set a $12.00 price target on shares of Rapid7 in a research note on Tuesday, August 11th. One investment 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. According to MarketBeat, Rapid7 currently has a consensus rating of “Reduce” and an average price target of $12.09.

Hedge Funds Weigh In On Rapid7

A number of institutional investors have recently modified their holdings of the business. Fulcrum Asset Management LLP acquired a new stake in Rapid7 during the 3rd quarter worth approximately $437,000. Ethic Inc. increased its holdings in shares of Rapid7 by 164.0% in the third quarter. Ethic Inc. now owns 28,416 shares of the technology company’s stock valued at $347,000 after purchasing an additional 17,653 shares during the period. Abacus Wealth Partners LLC purchased a new stake in shares of Rapid7 during the third quarter worth approximately $212,000. Chicago Partners Investment Group LLC purchased a new stake in shares of Rapid7 during the third quarter worth approximately $179,000. Finally, Mirae Asset Global Investments Co. Ltd. acquired a new stake in shares of Rapid7 during the third quarter worth $405,000. 95.66% of the stock is owned by institutional investors and hedge funds.

Rapid7 Trading Up 8.7%

The company has a fifty day moving average of $13.07 and a two-hundred day moving average of $9.55. The company has a quick ratio of 0.80, a current ratio of 0.80 and a debt-to-equity ratio of 1.50. The stock has a market capitalization of $1.10 billion, a price-to-earnings ratio of 51.88 and a beta of 0.90.

Rapid7 Company Profile

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.