Rapid7 (RPD) PT Lowered to $39 at Mizuho

Mizuho analyst Gregg Moskowitz lowered the price target on Rapid7 (NASDAQ: RPD) to $39.00 (from $42.00) while maintaining a Neutral rating.

The analyst commented: 'As expected, RPD reported another underwhelming quarter, as total ARR grew 4% Y/Y and was exactly in line with the Street's subdued forecast. Meanwhile, management provided a formal 2025E ARR growth outlook of 4%-6% Y/Y, roughly in line with Street expectations and consistent with the preliminary ARR guidance that had called for mid single-digit growth. However, RPD's full year revenue, non-GAAP EPS and FCF guidance was surprisingly disappointing, coming significantly below Street expectations.

More broadly, we believe that RPD is somewhat decently positioned in the SecOps market, and valuation remains quite inexpensive. Also, a retooled product (Command Platform) could drive better up-sell activity over time. However, RPD has experienced notable recent execution issues, and we continue to believe that it will struggle to significantly reignite ARR growth anytime soon. We reiterate our Neutral rating, and lower PT to $39 from $42."

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