When the Float Is Almost Gone – 95% Institutional Ownership Squeezes Rapid7

Strong accumulation and bullish options activity signal conviction despite limited free float

RPD Rapid7, Inc.

In this report

01

Institutional Ownership

Quarterly ownership trends, direction, investor count

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02

Position Flow Analysis

Flow ratio, conviction, new vs closed positions

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03

Float & Options Context

Put/call ratio, free float estimate, hedging activity

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04

Insider Trading Patterns

Insider buys/sells, top transactions, cluster buying, post-buy returns

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05

Smart Money Summary

Convergence/divergence flags, key takeaways

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Institutional Ownership Trends

Rapid7, Inc. (RPD) — Ownership Profile

Institutional ownership of Rapid7, Inc. stands at an elevated 94.66%, placing the company firmly in the heavily institutionalized category where float is limited and price movements may be more sensitive to large holder actions. Over the most recent quarter ownership slipped by 2.66 percentage points, marking a distributionary trend; however, the decline has persisted for only two consecutive quarters, falling short of the three‑quarter threshold required to label it a sustained distribution.

Ownership Overview

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The high ownership level indicates that institutional investors dominate the shareholder base, which can provide stability but also constrains free float. While recent quarterly data show a modest pullback in holdings, the lack of a sustained three‑quarter decline suggests the distribution may be tactical rather than a structural shift. The investor count of 254 reflects a broad institutional participation, underscoring diversified institutional interest despite the slight outflow.

Position Flow Analysis

Rapid7, Inc. (RPD) — Position Flows

Rapid7, Inc. exhibits robust position flow dynamics as indicated by a current flow ratio of 1.86, well above the 1.5 threshold for strong net accumulation. The conviction ratio of 0.7 further signals that existing institutional holders are not only maintaining but also increasing their stakes. Coupled with a sizable latest net inflow of 104 (million shares), the data suggest both fresh capital entry and heightened confidence among current investors over the near‑term horizon.

Position Flow Metrics

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Institutions are actively opening new positions, as reflected by the strong accumulation flow ratio of 1.86, while the conviction ratio of 0.7 indicates that existing holders are adding to their allocations. The net inflow of 104 underscores a significant net purchase volume, reinforcing the bullish stance from both new and incumbent investors.

Float & Options Context

Rapid7, Inc. (RPD) — Float & Options

Rapid7, Inc. (RPD) exhibits an extremely constrained free float of approximately 5.34%, derived from its high institutional ownership of 94.66%. The put/call ratio stands at 0.22 and is stable, indicating a pronounced call‑heavy options market that typically reflects bullish sentiment among option traders. Together, the limited float and strong call bias suggest that institutional investors are largely supportive of upside potential, while the scarcity of tradable shares could amplify price moves if demand intensifies.

Float & Options Overview

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The 0.22 put/call ratio is well below the 0.5 threshold, signaling that option buyers are predominantly purchasing calls rather than hedging with puts, which aligns with a bullish outlook from market participants. However, the constrained float of just over 5% means any surge in buying pressure could encounter limited supply, raising the risk of short‑term price spikes or squeezes. The convergence of strong call demand and scarce float underscores both upside enthusiasm and heightened volatility risk.

Float & Options Context

Rapid7, Inc. (RPD) — Put/Call Ratio

Insider Trading Patterns

Rapid7, Inc. (RPD) — Insider Activity

Over the past twelve months, insiders at Rapid7, Inc. have been net buyers, executing 10 purchase transactions totaling $19.03 million versus only $0.20 million in sales across seven transactions, yielding a buy/sell value ratio of 94.15 and a count ratio of 1.43. The dominant buying activity stems from Jana Partners Management, LP, which alone accounted for roughly $11.86 million (61% of total insider purchases) in two large trades within a three‑day window, while the only notable sell was CEO Thomas Corey’s disposition of 100,000 shares worth $3.94 million on January 21, 2025; overall post‑buy performance has been modest, with a 57.1% success rate and an average 30‑day return of just 1.4%, below the 70% benchmark for strong timing.

Insider Activity Summary

RPD

Insider activity shows a pronounced buying bias, comfortably exceeding the >2.0 buy/sell value threshold, indicating confidence from those with intimate knowledge of the business. The clustering of purchases by Jana Partners Management within a short period suggests coordinated belief in near‑term upside, though the modest post‑buy returns imply limited short‑term price appreciation. CEO selling represents routine diversification rather than distress, as it is isolated and not part of a broader sell‑off.

Insider Trading Patterns

Rapid7, Inc. (RPD) — Insider Timeline

Smart Money Summary

Rapid7, Inc. (RPD) — Summary & Implications

Rapid7 exhibits a high level of institutional ownership at 94.66%, though the stake slipped by 2.66 percentage points in the most recent quarter, indicating modest selling pressure from large holders. The flow classification of "strong accumulation" and a flow ratio of 0.22 suggest that net buying by institutions remains robust despite the slight decline in ownership share. Insider activity aligns with institutional behavior, showing net insider purchases amounting to 94.15% of the average daily volume, reinforcing confidence from company insiders.

Smart Money Dashboard

Key Takeaways

Institutional ownership remains exceptionally high at 94.66%, indicating limited free float but strong confidence from large investors.
A 2.66‑percentage-point quarterly decline reflects modest institutional selling, yet the flow ratio of 0.22 confirms net buying pressure.
Insider purchases covering 94.15% of average daily volume provide a potent bullish signal that aligns with institutional activity.
Convergent signals from both institutions and insiders suggest cohesive optimism about the company's near‑term prospects.

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The convergence of strong institutional accumulation and significant insider buying signals a unified positive outlook among smart money participants, despite a marginal dip in overall ownership percentage.

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Report written 2026-07-31 • Finexus

Disclaimer

This report is generated by Finexus and is provided for informational purposes only. It does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any security.

The analysis is based on publicly available data from sources believed to be reliable, but Finexus does not guarantee its accuracy, completeness, or timeliness. Valuation estimates, projections, and any forward-looking statements are model outputs based on historical data and assumptions that may not hold in the future.

Past performance is not indicative of future results. Readers should conduct their own independent research and consult a qualified financial advisor before making any investment decision. Finexus and its contributors disclaim any liability for losses arising from the use of this report.