Analyzing Rapid7 (NASDAQ:RPD) and Izea Worldwide (NASDAQ:IZEA)

Rapid7 (NASDAQ:RPD) and Izea Worldwide (NASDAQ:IZEA) are both small-cap computer and technology companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, risk, dividends, analyst recommendations, earnings and valuation.

Insider and Institutional Ownership

95.7% of Rapid7 shares are held by institutional investors. Comparatively, 15.6% of Izea Worldwide shares are held by institutional investors. 2.4% of Rapid7 shares are held by insiders. Comparatively, 6.5% of Izea Worldwide shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Rapid7 and Izea Worldwide”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rapid7	$859.79 million	0.53	$23.38 million	$0.35	19.34
Izea Worldwide	$31.24 million	2.01	$40,000.00	($0.03)	-119.67

Rapid7 has higher revenue and earnings than Izea Worldwide. Izea Worldwide is trading at a lower price-to-earnings ratio than Rapid7, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Rapid7 and Izea Worldwide, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rapid7	3	18	1	0	1.91
Izea Worldwide	2	0	0	0	1.00

Rapid7 currently has a consensus target price of $8.71, indicating a potential upside of 28.66%. Given Rapid7’s stronger consensus rating and higher possible upside, equities analysts plainly believe Rapid7 is more favorable than Izea Worldwide.

Risk and Volatility

Rapid7 has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500. Comparatively, Izea Worldwide has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500.

Profitability

This table compares Rapid7 and Izea Worldwide’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rapid7	2.61%	34.35%	2.78%
Izea Worldwide	-1.98%	-1.20%	-1.03%

Summary

Rapid7 beats Izea Worldwide on 11 of the 14 factors compared between the two stocks.

About Rapid7

Rapid7, Inc. provides cybersecurity solutions under the Rapid7, Nexpose, and Metasploit brand names. The company offers endpoint to cloud data collection and sharing applications, such as Rapid7 Insight Agent, a software-based agent that is used on assets across on-premises and cloud environments to centralize and monitor data on company's platform; Rapid7 Insight Network Sensor that analyzes raw end-to-end network traffic to increase visibility into user activity, pinpoint real threats, and investigations; Rapid7 Cloud Event Data Harvesting that offers visibility into changes made to cloud resources; and third-party integrations and ecosystem, as well as orchestration and automation solutions. It also offers various platforms, including Rapid7 managed threat complete consisting of managed detection response that delivers end-to-end threat detection and response, as well as offloads day-to-day vulnerability management operations. In addition, it provides Rapid7 threat complete consisting of InsightIDR, a security information and event management, and extended detection and response solution; and InsightVM, a vulnerability management solution that provides visibility across on-premise and remote endpoints for security teams to evaluate the business risks, and configurations, and share with their IT counterparts for remediation. Further, the company offers Rapid7 cloud risk complete, which includes InsightCloudSec, a cloud risk and compliance management solution; and InsightAppSec, a dynamic application security testing tool. It also provides professional services. It serves a range of industries, including business services, pharmaceuticals, technology, energy, financial services, healthcare and life sciences, manufacturing, media and entertainment, retail, education, real estate, travel and transportation, government, online services, telecommunications, and professional services. The company was incorporated in 2000 and is headquartered in Boston, Massachusetts.

About Izea Worldwide

IZEA Worldwide, Inc., together with its subsidiaries, offers software and professional services to connect brands and content creators in North America, the Asia Pacific, and internationally. The company offers IZEA Flex, its flagship platform for managing enterprise influencer marketing; and comprehensive expense management service to track and manage off-platform expenses related to influencer marketing campaigns. It also operates The Creator Marketplace on IZEA.com that provides creators tools to present their work to marketers. In addition, the company provides management of content workflow, creator search and targeting, bidding, analytics, and payment processing services. It primarily sells influencer marketing and custom content campaigns through client development team and platforms. The company was formerly known as IZEA, Inc. and changed its name to IZEA Worldwide, Inc. in August 2018. IZEA Worldwide, Inc. was founded in 2006 and is headquartered in Orlando, Florida.