Rapid7

RPD

Software - Infrastructure · Technology

Price

$12.20

+0.03 (+0.25%)

Market Cap

$815.3M

Exchange

NASDAQ

Winston Score

Winston is serious

Below-average fundamentals — multiple weak pillars.

Share count rising — dilution

+17.6% over 4y

The company has issued more shares over this period, which dilutes each existing shareholder’s stake.

Diluted shares outstanding: 55.3M (2021) → 65.0M (2025)

Rapid7, Inc. provides cyber security solutions. The company offers a cloud-native insight platform that enables customers to create and manage analytics-driven cyber security risk management programs. Its platform includes InsightIDR, an incident detection and response solution; InsightCloudSec, a solution that integrates posture management, workload protection, infrastructure entitlements management, infrastructure-as-code security, and Kubernetes protection; InsightVM, a vulnerability risk man

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

-0.3% YoY

YoY Growth Rate

Revenue declining

EPS Growth

-43.0% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$191M/ year

↑ Rising (+10% vs prior year)

22.2% of revenue

In line with sector average (15%)

Investing heavily in future products and technology

Insider Activity

12.1%ownership

→ Flat

Insiders holding steady — not selling despite ability to

Cash Position

Cash flow positive

$343M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Heavy R&D investment

Rapid7 is putting 22% of revenue into R&D and that number is rising. And they're generating enough cash to self-fund it.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

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Quality

Gross Margin

69.1%

Premium pricing power — 69.1% gross margin

Operating Margin

-0.3%

Losing money on operations — -0.3%

ROCE

-0.1%

Weak — -0.1% return on capital

Negative ROIC means the business is losing money on every dollar invested in it.

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Growth

Sales YoY

+1.2%

Nearly flat sales (1.2% YoY)

EPS YoY

-23.4%

Earnings shrinking (-23.4% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

2/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

730%

Turns 730% of profit into real cash

FCF Margin

17.6%

Converts sales into free cash efficiently (17.6%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

Debt / Equity

5.21

Heavy debt load (5.21)

Interest Cover

1.08x

Dangerous — barely covers interest (1.1x)

Interest coverage between 1 and 3. Profits cover interest, but with little room to spare.

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Valuation

P/E Ratio (TTM)

35.4x

Pricey — P/E 35.4

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+28.1

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (35.4 → 7.2)

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Dividends

Not applicable for this business.

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