Is Rapid7, Inc. overvalued or undervalued?

As of 17 October 2025, Rapid7, Inc. has moved from a fair to very attractive valuation grade. The company appears to be undervalued, particularly when considering its PEG ratio of 0.38, which indicates strong growth potential relative to its price, alongside 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 is more attractively priced despite its growth prospects.
The company's recent stock performance has been significantly underwhelming, with a year-to-date return of -55.33% compared to the S&P 500's 13.30%, and a three-year return of -57.48% versus the S&P 500's impressive 81.19%. This stark contrast reinforces the notion that Rapid7 is undervalued in the current market context.