Rapid7 (NASDAQ:RPD – Get Free Report) and Bridgeline Digital (NASDAQ:BLIN – Get Free Report) are both small-cap technology companies, but which is the superior business? We will compare the two companies based on the strength of their risk, valuation, earnings, dividends, institutional ownership, profitability and analyst recommendations.
Insider & Institutional Ownership
95.7% of Rapid7 shares are held by institutional investors. Comparatively, 15.1% of Bridgeline Digital shares are held by institutional investors. 2.0% of Rapid7 shares are held by insiders. Comparatively, 27.5% of Bridgeline Digital shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Volatility and Risk
Rapid7 has a beta of 1.02, indicating that its share price is 2% more volatile than the S&P 500. Comparatively, Bridgeline Digital has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.
Analyst Ratings
This is a summary of current ratings and price targets for Rapid7 and Bridgeline Digital, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Rapid7 | 5 | 17 | 1 | 0 | 1.83 |
| Bridgeline Digital | 1 | 1 | 1 | 0 | 2.00 |
Rapid7 currently has a consensus target price of $12.09, suggesting a potential downside of 18.93%. Bridgeline Digital has a consensus target price of $4.62, suggesting a potential upside of 544.89%. Given Bridgeline Digital’s stronger consensus rating and higher possible upside, analysts clearly believe Bridgeline Digital is more favorable than Rapid7.
Valuation and Earnings
This table compares Rapid7 and Bridgeline Digital”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Rapid7 | $859.79 million | 1.17 | $23.38 million | $0.31 | 48.10 |
| Bridgeline Digital | $15.38 million | 0.59 | -$2.52 million | ($0.12) | -5.97 |
Rapid7 has higher revenue and earnings than Bridgeline Digital. Bridgeline Digital is trading at a lower price-to-earnings ratio than Rapid7, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Rapid7 and Bridgeline Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Rapid7 | 2.35% | 27.89% | 2.66% |
| Bridgeline Digital | -8.65% | -14.51% | -8.76% |
Summary
Rapid7 beats Bridgeline Digital on 10 of the 13 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 Bridgeline Digital
Bridgeline Digital, Inc. operates as a marketing technology company in the United States, Canada, and internationally. The company offers HawkSearch, a site search, recommendation, and personalization application for marketers, merchandisers, and developers; Celebros Search, a commerce-oriented site search product that provides natural language processing with artificial intelligence; and Woorank, a Search Engine Optimization (SEO) audit tool that generates an instant performance audit of the site's technical, on-page, and off-page SEO. It also provides Bridgeline TruPresence, a web content management and eCommerce platform to support the needs of multi-unit organizations and franchises; Bridgeline Unbound, a technology suite that empower marketers to easily manage their digital experiences and create personalized customer journeys; and OrchestraCMS, a digital experience platform that enables development of custom solutions, third-party integrations, and delivery of digital transformation initiatives on the Salesforce platform. In addition, the company offers digital engagement services comprising digital strategy, web design and web development, usability engineering, information architecture, and SEO, as well as hosting services. It serves vertical markets, such as industrial distributors and wholesalers, franchises and enterprises, manufacturers, eCommerce retailers, health services and life sciences, technology, credit unions and banks, and associations and foundations through its direct sales force. The company was formerly known as Bridgeline Software, Inc. Bridgeline Digital, Inc. was incorporated in 2000 and is based in Woburn, Massachusetts.
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