Rapid7 (RPD) Q4 Earnings Report Preview: What To Look For
Cybersecurity software maker Rapid7 (NASDAQ:RPD) will be reporting results tomorrow after market hours. Here's what investors should know.
Last quarter Rapid7 reported revenues of $198.8 million, up 13.1% year on year, in line with analyst expectations. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and decelerating customer growth. The company added 125 customers to a total of 11,412.
Is Rapid7 buy or sell heading into the earnings? Read our full analysis here, it's free.
This quarter analysts are expecting Rapid7's revenue to grow 9.1% year on year to $201.4 million, slowing down from the 21.7% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.48 per share.
Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 1.7%.
Looking at Rapid7's peers in the cybersecurity segment, only Varonis has so far reported results, delivering top-line growth of 8.1% year on year, and beating analyst estimates by 1.6%. Varonis traded up 2.7% on the results.
Read our full analysis of Varonis's earnings results here.
There has been positive sentiment among investors in the cybersecurity segment, with the stocks up on average 3.2% over the last month. Rapid7 is up 6.1% during the same time, and is heading into the earnings with analyst price target of $59.4, compared to share price of $56.2.
One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.
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The author has no position in any of the stocks mentioned.
