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Investing.com - Jefferies has reduced its price target on Rapid7 (NASDAQ:RPD) to $27.00 from $35.00 while maintaining a Buy rating on the cybersecurity firm’s stock. The company, currently trading at $19.82 with a market cap of $1.27 billion, has seen its shares decline 48% over the past six months, now trading near its 52-week low of $19.21.
The price target adjustment follows Rapid7’s second-quarter annual recurring revenue (ARR) results, which were in line with expectations, but the company lowered the midpoint of its fiscal year 2025 guidance due to longer sales cycles.
Jefferies noted that Rapid7’s Managed Detection and Response (MDR) service continued its positive performance, growing in the mid-teens percentage range during the quarter, consistent with its first-quarter growth rate.
Despite the price target reduction, Jefferies emphasized that Rapid7 stock "remains extremely cheap" at 3 times next twelve months’ recurring revenue, compared to Jefferies’ implied base value of 5.4 times.
The firm maintained its Buy rating on Rapid7 shares, suggesting continued confidence in the company’s long-term prospects despite the near-term challenges that prompted the guidance adjustment.
In other recent news, Rapid7 has announced several significant developments. The company launched Incident Command, a next-generation Security Information and Event Management solution, which aims to enhance threat detection and response capabilities through AI-powered workflows. Additionally, Rapid7 introduced Active Patching, an automated patching solution designed to help security teams address vulnerabilities across endpoints efficiently. In terms of regulatory achievements, Rapid7’s InsightGovCloud Platform received FedRAMP Authorization, allowing it to offer cloud-based security services to U.S. federal agencies. Meanwhile, JPMorgan has maintained its Neutral rating on Rapid7, highlighting ongoing execution issues and projecting another quarter of deceleration in Net New Annual Recurring Revenue, though improvement is expected later in the year. These developments reflect Rapid7’s ongoing efforts to innovate in cybersecurity while addressing operational challenges.
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