Is Rapid7, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Rapid7, Inc. has moved from fair to very attractive, indicating a significant improvement in its perceived value. The company appears to be undervalued, particularly when considering its strong PEG ratio of 0.38, a P/E ratio of 52, and an EV to EBITDA ratio of 26.84. In comparison to peers, Rapid7's P/E ratio is lower than Pegasystems, Inc. at 48.13 and Wix.com Ltd. at 49.44, suggesting it may offer better value relative to its earnings potential.
Despite the attractive valuation metrics, Rapid7 has underperformed significantly against the S&P 500, with a year-to-date return of -55.33% compared to the index's 13.30%. This stark contrast highlights the potential for recovery in the stock price, aligning with its favorable valuation ratios.