Stock Story -
Cybersecurity software maker Rapid7 (NASDAQ:RPD) will be reporting earnings tomorrow after market close. Here's what you need to know.
Rapid7 met analysts' revenue expectations last quarter, reporting revenues of $205.1 million, up 12% year on year. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and decelerating customer growth. It lost 64 customers and ended up with a total of 11,462.
Is Rapid7 a buy or sell going into earnings? Find out by reading the original article on StockStory, it's free.
This quarter, analysts are expecting Rapid7's revenue to grow 7.2% year on year to $204.1 million, slowing from the 13.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.52 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Rapid7 has only missed Wall Street's revenue estimates once over the last two years, exceeding top-line expectations by 1.3% on average.
Looking at Rapid7's peers in the cybersecurity segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Tenable (NASDAQ:TENB) delivered year-on-year revenue growth of 13.4%, beating analysts' expectations by 1.2%, and Varonis (NASDAQ:VRNS) reported revenues up 12.9%, topping estimates by 4.4%. Tenable traded down 7.7% following the results while Varonis was up 14.7%.
Read the full analysis of Tenable's and Varonis's results on StockStory.
Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 thanks to cooling inflation. 2024 has been a different story as mixed signals have led to market volatility, and while some of the cybersecurity stocks have fared somewhat better, they have not been spared, with share prices down 3.7% on average over the last month. Rapid7 is down 10.6% during the same time and is heading into earnings with an average analyst price target of $47.5 (compared to the current share price of $36.69).
![Rapid7 (RPD) Q2 Earnings: What To Expect](https://d68-invdn-com.investing.com/content/piccda5ec9b0135e12e0e26c751ce52a615.jpeg)