Rapid7 (NASDAQ:RPD) & AppLovin (NASDAQ:APP) Financial Review

AppLovin (NASDAQ:APP) and Rapid7 (NASDAQ:RPD) are both technology companies, but which is the better stock? We will compare the two businesses based on the strength of their risk, profitability, institutional ownership, dividends, earnings, analyst recommendations and valuation.

Institutional and Insider Ownership

41.9% of AppLovin shares are owned by institutional investors. Comparatively, 95.7% of Rapid7 shares are owned by institutional investors. 12.8% of AppLovin shares are owned by company insiders. Comparatively, 2.0% of Rapid7 shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

AppLovin has a beta of 2.49, meaning that its share price is 149% more volatile than the S&P 500. Comparatively, Rapid7 has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AppLovin	64.58%	193.10%	59.63%
Rapid7	2.35%	27.89%	2.66%

Valuation and Earnings

This table compares AppLovin and Rapid7″s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AppLovin	$5.48 billion	19.48	$3.33 billion	$13.01	24.52
Rapid7	$859.79 million	0.87	$23.38 million	$0.31	35.71

AppLovin has higher revenue and earnings than Rapid7. AppLovin 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 summary of current ratings and recommmendations for AppLovin and Rapid7, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AppLovin	0	8	13	3	2.79
Rapid7	4	18	1	0	1.87

AppLovin currently has a consensus price target of $538.61, suggesting a potential upside of 68.82%. Rapid7 has a consensus price target of $11.98, suggesting a potential upside of 8.23%. Given AppLovin’s stronger consensus rating and higher possible upside, research analysts clearly believe AppLovin is more favorable than Rapid7.

Summary

AppLovin beats Rapid7 on 13 of the 15 factors compared between the two stocks.

About AppLovin

AppLovin Corporation engages in building a software-based platform for advertisers to enhance the marketing and monetization of their content in the United States and internationally. It operates through two segments, Software Platform and Apps. The company's software solutions include AppDiscovery, a marketing software solution, which matches advertiser demand with publisher supply through auctions; MAX, an in-app bidding software that optimizes the value of a publisher's advertising inventory by running a real-time competitive auction; Adjust, a measurement and analytics marketing platform that provides marketers with the visibility, insights, and tools needed to grow their apps from early stage to maturity; and Wurl, a connected TV platform, which distributes streaming video for content companies and provides advertising and publishing solutions through its AdPool, ContentDiscovery, and Global FAST Pass products. It also offers SparkLabs, which uses app store optimization to enhance ad visibility; AppLovin Exchange, which connects buyers to mobile and CTV devices through a single and direct RTB exchange; and Array, an end-to-end app management suite for mobile operators and end users. In addition, the company operates various free-to-play mobile games. It serves individuals, small and independent businesses, enterprises, advertisers and advertising networks, mobile app publishers, indie studio developers, and internet platforms. AppLovin Corporation was incorporated in 2011 and is headquartered in Palo Alto, California.

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.