Piper Sandler Begins Coverage on Red Cat (NASDAQ:RCAT)

Key Points

• Piper Sandler initiated coverage of Red Cat with a “hold” rating and a $9 price target, implying approximately 8.2% upside from the prior close.
• Analyst sentiment remains broadly positive, with Red Cat carrying a consensus “Moderate Buy” rating and an average price target of $18, despite mixed targets ranging from $9 to $25.
• Red Cat’s latest quarterly results missed expectations: the company reported an adjusted loss of $0.26 per share versus a projected $0.21 loss and revenue of $20.2 million versus a $22.65 million estimate.

Piper Sandler initiated coverage on shares of Red Cat (NASDAQ:RCAT - Get Free Report) in a report released on Wednesday, MarketBeat reports. The firm set a "hold" rating and a $9.00 price target on the stock. Piper Sandler's target price suggests a potential upside of 8.17% from the company's previous close.

RCAT has been the topic of several other reports. Roth Capital assumed coverage on Red Cat in a report on Monday, June 1st. They issued a "buy" rating and a $25.00 target price on the stock. Needham & Company LLC lowered their price target on Red Cat from $20.00 to $15.00 and set a "buy" rating for the company in a research report on Friday, August 7th. UBS Group initiated coverage on shares of Red Cat in a research note on Wednesday, May 27th. They issued a "buy" rating on the stock. Evercore initiated coverage on shares of Red Cat in a research report on Monday. They set an "outperform" rating and a $15.00 price objective on the stock. Finally, Weiss Ratings restated a "sell (d-)" rating on shares of Red Cat in a research note on Friday, July 17th. Two equities research analysts have rated the stock with a Strong Buy rating, five have assigned a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, Red Cat currently has a consensus rating of "Moderate Buy" and an average price target of $18.00.

Red Cat Stock Performance

Shares of RCAT opened at $8.32 on Wednesday. Red Cat has a fifty-two week low of $5.77 and a fifty-two week high of $18.78. The firm's 50-day simple moving average is $9.00 and its two-hundred day simple moving average is $11.25. The stock has a market cap of $1.02 billion, a PE ratio of -10.27 and a beta of 1.35.

Red Cat (NASDAQ:RCAT - Get Free Report) last issued its quarterly earnings results on Thursday, August 6th. The company reported ($0.26) EPS for the quarter, missing analysts' consensus estimates of ($0.21) by ($0.05). The company had revenue of $20.20 million during the quarter, compared to the consensus estimate of $22.65 million. Red Cat had a negative return on equity of 32.25% and a negative net margin of 136.26%. Equities research analysts predict that Red Cat will post -0.78 EPS for the current year.

Insider Activity at Red Cat

In related news, Director Nicholas Reyland Liuzza, Jr. sold 55,000 shares of Red Cat stock in a transaction dated Tuesday, August 11th. The stock was sold at an average price of $10.63, for a total value of $584,650.00. Following the completion of the sale, the director directly owned 489,874 shares in the company, valued at approximately $5,207,360.62. This trade represents a 10.09% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, Director Christopher R. Moe sold 20,000 shares of the business's stock in a transaction dated Tuesday, August 11th. The stock was sold at an average price of $10.51, for a total value of $210,200.00. Following the completion of the transaction, the director directly owned 200,502 shares of the company's stock, valued at approximately $2,107,276.02. This trade represents a 9.07% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 240,028 shares of company stock valued at $2,692,672 over the last ninety days. Insiders own 12.50% of the company's stock.

Institutional Investors Weigh In On Red Cat

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. BlackRock Inc. purchased a new stake in Red Cat during the 2nd quarter valued at $119,610,000. State Street Corp increased its position in Red Cat by 136.4% during the fourth quarter. State Street Corp now owns 6,612,153 shares of the company's stock valued at $52,434,000 after acquiring an additional 3,815,310 shares during the last quarter. Van ECK Associates Corp purchased a new stake in Red Cat during the second quarter valued at $27,193,000. Vanguard Group Inc. lifted its holdings in Red Cat by 43.9% in the third quarter. Vanguard Group Inc. now owns 5,506,377 shares of the company's stock valued at $56,991,000 after acquiring an additional 1,680,929 shares during the period. Finally, Davidson Kempner Capital Management LP purchased a new position in Red Cat in the third quarter worth about $17,286,000. 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.

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