BOSTON—Sondhi Reeny, a director at Rapid7, Inc. (NASDAQ:RPD), recently sold a portion of her holdings in the cybersecurity company, according to a regulatory filing with the Securities and Exchange Commission. The transaction, dated November 15, involved the sale of 3,663 shares of Rapid7's common stock at a price of $40.75 per share, amounting to a total of $149,267.
Following this sale, Reeny retains ownership of 13,797 shares in the company. The transaction was executed as part of a pre-arranged trading plan.
Rapid7, headquartered in Boston, specializes in cybersecurity solutions and services, assisting organizations in managing and mitigating risks associated with digital threats.
In other recent news, Rapid7, Inc. reported a year-over-year growth in its third-quarter earnings for 2024, alongside an 8% increase in revenue. Despite a slight miss on the expected Annual Recurring Revenue (ARR), the company remains positive about its growth potential, especially with the introduction of the Exposure Command platform and a shift towards partner-based initiatives. Rapid7 ended Q3 2024 with $823 million in ARR, a 6% increase year-over-year, and Q3 revenue reached $215 million. The company also adjusted its full-year ARR outlook to $835 million to $845 million.
Internationally, Rapid7 saw a 17% growth in revenue, with a stable total gross margin of 74%. The launch of the Exposure Command platform resulted in a 70% increase in pipeline creation for risk management solutions. In terms of future developments, Rapid7 anticipates flat to mild acceleration in total ARR growth for 2025 and raised its full-year revenue guidance to $839 million to $841 million.
However, the company did not meet the expected ARR for Q3 2024, attributing the shortfall to longer deal cycles. Despite this, Rapid7 remains committed to its strategic priorities of enhancing detection and response capabilities, expanding the partner ecosystem, and accelerating cloud security adoption.
InvestingPro Insights
Following Sondhi Reeny's recent sale of Rapid7 (NASDAQ:RPD) shares, it's worth examining some key financial metrics and insights provided by InvestingPro to gain a broader perspective on the company's current position.
Rapid7's market capitalization stands at $2.47 billion, reflecting its significant presence in the cybersecurity sector. The company has demonstrated solid revenue growth, with a 10.05% increase over the last twelve months as of Q3 2024, reaching $833.01 million. This growth trajectory aligns with the company's expanding role in digital threat management.
InvestingPro Tips highlight that Rapid7 is expected to see net income growth this year, which could be a positive sign for investors despite the recent insider sale. The company has also been profitable over the last twelve months, with a gross profit margin of 70.65%, indicating strong pricing power in its cybersecurity offerings.
However, it's important to note that Rapid7 is trading at a relatively high P/E ratio of 51.52, which suggests that the stock may be priced at a premium compared to its earnings. This valuation metric could be a factor for investors to consider when assessing the stock's potential.
For those seeking a more comprehensive analysis, InvestingPro offers additional insights, with 8 more tips available for Rapid7. These tips could provide valuable context for understanding the company's financial health and market position beyond the recent insider transaction.
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