Red Cat (NASDAQ:RCAT) Trading Down 4.9% – Here’s Why

Red Cat Holdings, Inc. (NASDAQ:RCAT) traded down 4.9% during mid-day trading on Friday . The company traded as low as $7.54 and last traded at $7.64. 6,534,184 shares traded hands during trading, a decline of 54% from the average session volume of 14,334,161 shares. The stock had previously closed at $8.03.

More Red Cat News

Here are the key news stories impacting Red Cat this week:

• Positive Sentiment: Red Cat announced it completed integration of its Black Widow™ drone with C3A Solutions’ OBERON-enabled tactical fires networks, expanding Black Widow’s role as a forward ISR sensor for defense customers and reinforcing the company’s military interoperability story. Article Title
• Neutral Sentiment: Short interest data showed no meaningful change in reported short interest, suggesting the latest trading pressure is being driven more by fundamentals and company-specific headlines than by a clear short-selling shift.
• Neutral Sentiment: Several recent write-ups argued that RCAT may still be overvalued after a strong multi-year run, with valuation models suggesting much of the upside could already be priced in. Article Title
• Negative Sentiment: Investor sentiment was hurt by news that Red Cat terminated Chief Revenue Officer Geoffrey Hitchcock for cause, followed by a civil complaint alleging retaliatory termination and contract breaches, raising governance and internal-control concerns. Article Title
• Negative Sentiment: Recent commentary also pointed to insider selling, a weak recent share-price trend, and uncertainty ahead of earnings, all of which can weigh on near-term sentiment toward RCAT. Article Title

Wall Street Analyst Weigh In

RCAT has been the topic of a number of recent analyst reports. LADENBURG THALM/SH SH upgraded Red Cat to a “strong-buy” rating in a report on Wednesday, May 6th. UBS Group assumed coverage on Red Cat in a research report on Wednesday, May 27th. They issued a “buy” rating on the stock. Wall Street Zen lowered Red Cat from a “sell” rating to a “strong sell” rating in a research note on Saturday, July 18th. Weiss Ratings reiterated a “sell (d-)” rating on shares of Red Cat in a report on Friday, July 17th. Finally, HC Wainwright began coverage on shares of Red Cat in a research note on Wednesday, May 27th. They set a “buy” rating and a $20.00 target price for the company. Two equities research analysts have rated the stock with a Strong Buy rating, four have given a Buy rating and one has given a Sell rating to the stock. According to data from MarketBeat, Red Cat has an average rating of “Buy” and an average target price of $21.40.

Red Cat Stock Down 5.0%

The firm has a market cap of $936.51 million, a price-to-earnings ratio of -10.90 and a beta of 1.29. The company’s 50-day moving average price is $10.34 and its 200-day moving average price is $12.12.

Red Cat (NASDAQ:RCAT) last announced its quarterly earnings data on Thursday, May 7th. The company reported ($0.22) earnings per share for the quarter, missing analysts’ consensus estimates of ($0.12) by ($0.10). Red Cat had a negative net margin of 138.36% and a negative return on equity of 35.86%. The business had revenue of $15.47 million during the quarter, compared to analyst estimates of $17.63 million. The business’s quarterly revenue was up 849.1% compared to the same quarter last year. On average, sell-side analysts predict that Red Cat Holdings, Inc. will post -0.68 earnings per share for the current fiscal year.

Insider Buying and Selling

In other Red Cat news, Director Paul Funk II sold 165,028 shares of the business’s stock in a transaction on Thursday, June 11th. The shares were sold at an average price of $11.50, for a total value of $1,897,822.00. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through the SEC website. 12.50% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Red Cat

Hedge funds and other institutional investors have recently made changes to their positions in the stock. Fifth Third Bancorp acquired a new stake in shares of Red Cat in the 1st quarter valued at $33,000. IFP Advisors Inc grew its stake in shares of Red Cat by 181.1% during the third quarter. IFP Advisors Inc now owns 2,670 shares of the company’s stock worth $28,000 after purchasing an additional 1,720 shares in the last quarter. NFSG Corp increased its holdings in Red Cat by 200.0% in the first quarter. NFSG Corp now owns 3,000 shares of the company’s stock valued at $39,000 after buying an additional 2,000 shares during the last quarter. PNC Financial Services Group Inc. increased its holdings in Red Cat by 294.6% in the first quarter. PNC Financial Services Group Inc. now owns 3,042 shares of the company’s stock valued at $40,000 after buying an additional 2,271 shares during the last quarter. Finally, Bank of America Corp DE raised its stake in Red Cat by 407.0% in the fourth quarter. Bank of America Corp DE now owns 3,397 shares of the company’s stock valued at $44,000 after buying an additional 2,727 shares in the last quarter. Hedge funds and other institutional investors own 37.97% of the company’s stock.

About Red Cat

Red Cat Holdings, Inc (NASDAQ: RCAT) is a technology holding company that develops and delivers advanced robotics, autonomy, and sensing solutions for defense, national security, public safety and commercial customers. Headquartered in American Fork, Utah, the company brings together a portfolio of specialized operating businesses focused on unmanned aerial systems (UAS), mission management software, precision mapping sensors and engineering services.

Through its UAS segment, Red Cat designs and manufactures small to medium-sized fixed-wing and vertical-takeoff drones that support intelligence, surveillance and reconnaissance (ISR) missions.