Rubrik, Inc. (RBRK): A Bull Case Theory
A high-rise office building, its staff busy at work providing cybersecurity services.
Rubrik (RBRK) has significantly outpaced expectations, approaching the author's $110 per share target well ahead of the original summer 2026 timeline. While this rapid rally increases the likelihood of a near-term pullback, particularly around earnings as investors look to lock in profits, the recommendation remains to hold the position. The stock's earlier volatility and sharp rebounds underscore the importance of avoiding stop-loss strategies, which might have shaken out long-term investors prematurely.
Rubrik's core strength lies in its comprehensive 'cyber resilience' platform, which goes beyond traditional cybersecurity by ensuring companies can quickly recover from attacks. Its unified approach protects data across cloud, on-premises, and popular SaaS applications like Microsoft 365, offering a critical solution as businesses face growing AI-driven data risks. The company's fiscal 2026 guidance, given amid macro uncertainty and market volatility in March, was understandably conservative.
Nevertheless, if Rubrik can achieve 45% year-over-year growth, it would significantly bolster confidence in its trajectory toward the $110 target. Although the stock trades at a rich 160x forward free cash flow, the valuation reflects optimism around Rubrik's scalable model.
Management delivered an exceptional 29% free cash flow margin in Q4 FY25, but full-year expectations have been tempered to 10%, implying some lumpiness ahead. Still, with a projected free cash flow of $120 million and powerful demand trends in cybersecurity, Rubrik is positioned to grow into its valuation. Despite short-term risks, the structural growth story remains intact, and investors are encouraged to stay patient as the company continues to execute within a high-potential sector.
We previously covered a on Rubrik (RBRK) by ElectSamsepi0l on the wallstreetbets Subreddit in December 2024, highlighting its post-IPO momentum, partnerships, and strong ARR growth crossing $1B. The thesis has played out well as the stock price of RBRK has appreciated by roughly 84% since then. Deep Value Returns' June 2025 Substack echoes this optimism but emphasizes Rubrik's accelerating path toward a $110 price target, robust free cash flow margins, and its differentiated cyber resilience platform, framing it as a long-term compounder despite elevated valuation multiples.
Rubrik, Inc. (RBRK) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 45 hedge fund portfolios held RBRK at the end of the first quarter which was 41 in the previous quarter. While we acknowledge the risk and potential of RBRK as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
Disclosure: None. This article was originally published at Insider Monkey.
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