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Rapid7 Inc . (NASDAQ: NASDAQ:RPD), a cybersecurity solutions provider with a market capitalization of $2.02 billion and impressive gross margins of 70%, has seen its stock price touch a 52-week low, reaching $32.01. According to InvestingPro analysis, the stock’s RSI indicates oversold conditions. This price level reflects a significant downturn from its previous performance, with the company’s shares experiencing a substantial 1-year change, plummeting by -41.53%. Investors are closely monitoring Rapid7 as it navigates through a challenging market environment, which has seen many tech stocks retreat from their highs. Despite the current downturn, InvestingPro data shows the company maintains strong fundamentals with $844 million in revenue. The company’s ability to rebound from this low will be watched with keen interest as market conditions evolve. InvestingPro analysis suggests the stock is currently undervalued, with 13 additional exclusive insights available to subscribers through the comprehensive Pro Research Report.
In other recent news, Rapid7 reported its fourth-quarter revenue of $216.26 million, surpassing analyst estimates of $212.17 million and showing a 5% year-over-year growth. Despite this positive revenue performance, the company’s guidance for the first quarter and full year 2025 fell short of Wall Street expectations, with Q1 revenue projected between $207-209 million and full-year guidance of $860-870 million, below the anticipated $886.25 million. Rapid7’s annual recurring revenue (ARR) increased by 4% to $839.8 million, although this was slightly below consensus estimates.
Analyst firms have responded to these developments with several adjustments to Rapid7’s stock price targets. DA Davidson lowered its target to $35, maintaining a Neutral rating, while Mizuho (NYSE:MFG) reduced its target to $39, also keeping a Neutral stance. Citi analysts adjusted their price target to $44 but upheld a Buy rating, citing potential for future growth despite current challenges. Similarly, Jefferies decreased its target to $45 while reaffirming a Buy rating, noting the company’s attractive valuation despite risks.
Rapid7’s management has projected ARR growth of 4-6% for 2025, aligning with prior guidance and analyst expectations. However, the company’s guidance for operating margins and earnings per share has fallen short of consensus projections due to planned investments in Managed Detection and Response (MDR) capabilities. Despite these challenges, Rapid7 continues to focus on expanding its Detection and Response segment, which is growing at a mid-teens rate year-over-year.
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