JPMorgan analyst Brian Essex downgraded Rapid7 (NASDAQ: RPD) from Neutral to Underweight with a price target of $12.00.

The analyst comments: “Downgrading RPD to Underweight from Neutral as we see better risk/reward elsewhere within our coverage. Following C2Q earnings season, along with recent stock price moves, we are moving RPD to Underweight from Neutral. We view the downgrade as a relative call within our coverage as: 1) RPD is still working through an executive and sales operation transition that we think will take several quarters to play out before growth meaningfully improves, 2) we view peers as better positioned to capture the secular tailwinds we currently see across the security landscape, and 3) we see the magnitude of the recent stock move (+24% today) as unwarranted against that backdrop. Performance across the security software sector has been elevated in recent quarters, and RPD has benefited from a "halo effect" tied to the group's strength as an elevated vulnerability environment persists, but fundamental risk remains an issue. As a result, we move to Underweight as we see better risk/reward opportunity elsewhere within our coverage.”

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Shares of Rapid7 closed at $12.79 yesterday.