Red Cat (NASDAQ:RCAT) Sets New 12-Month Low - Here's What Happened

Key Points

• Red Cat shares fell 8.7% to a new 52-week low of $4.72, well below their 50-day and 200-day moving averages.
• The company missed quarterly expectations, reporting an adjusted loss of $0.26 per share versus estimates of $0.21 and revenue of $20.2 million versus $22.65 million expected.
• Analyst sentiment remains mixed: Red Cat has an average “Moderate Buy” rating and a $16.71 price target, while recent insider selling totaled 225,000 shares worth about $1.96 million.

Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report)'s share price hit a new 52-week low during mid-day trading on Thursday. The company traded as low as $4.72 and last traded at $4.73, with a volume of 8,743,140 shares traded. The stock had previously closed at $5.18.

Analyst Ratings Changes

A number of research firms recently commented on RCAT. Needham & Company LLC decreased their target price on shares of Red Cat from $20.00 to $15.00 and set a "buy" rating for the company in a research report on Friday, August 7th. Evercore initiated coverage on shares of Red Cat in a research note on Monday, August 31st. They issued an "outperform" rating and a $15.00 target price for the company. Zacks Research lowered shares of Red Cat from a "hold" rating to a "strong sell" rating in a report on Monday. Wall Street Zen lowered shares of Red Cat from a "sell" rating to a "strong sell" rating in a report on Saturday, July 18th. Finally, HC Wainwright reaffirmed a "buy" rating and set a $20.00 price target on shares of Red Cat in a research report on Friday, August 7th. Two equities research analysts have rated the stock with a Strong Buy rating, five have given a Buy rating, one has given a Hold rating and two have given a Sell rating to the company. Based on data from MarketBeat, Red Cat has an average rating of "Moderate Buy" and an average price target of $16.71.

Red Cat Stock Down 8.7%

The company has a market capitalization of $580.56 million, a PE ratio of -5.84 and a beta of 1.51. The business has a 50 day simple moving average of $7.93 and a 200 day simple moving average of $9.72.

Red Cat (NASDAQ:RCAT - Get Free Report) last issued its quarterly earnings results on Thursday, August 6th. The company reported ($0.26) earnings per share for the quarter, missing analysts' consensus estimates of ($0.21) by ($0.05). Red Cat had a negative return on equity of 32.25% and a negative net margin of 136.26%. The business had revenue of $20.20 million for the quarter, compared to analysts' expectations of $22.65 million. Equities analysts expect that Red Cat Holdings, Inc. will post -0.79 EPS for the current fiscal year.

Insider Buying and Selling

In other Red Cat news, Director Christopher R. Moe sold 20,000 shares of the company's stock in a transaction that occurred on Tuesday, August 11th. The shares were sold at an average price of $10.51, for a total transaction of $210,200.00. Following the transaction, the director owned 200,502 shares in the company, valued at approximately $2,107,276.02. This represents a 9.07% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, Director Nicholas Reyland Liuzza, Jr. sold 55,000 shares of the firm's stock in a transaction on Tuesday, August 11th. The stock was sold at an average price of $10.63, for a total transaction of $584,650.00. Following the completion of the transaction, the director directly owned 489,874 shares of the company's stock, valued at approximately $5,207,360.62. This represents a 10.09% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 225,000 shares of company stock worth $1,955,850 in the last three months. Corporate insiders own 12.50% of the company's stock.

Institutional Investors Weigh In On Red Cat

Large investors have recently made changes to their positions in the stock. State Street Corp lifted its holdings in Red Cat by 68.8% in the second quarter. State Street Corp now owns 12,091,447 shares of the company's stock valued at $128,774,000 after acquiring an additional 4,928,540 shares during the period. BlackRock Inc. acquired a new stake in shares of Red Cat during the 2nd quarter worth approximately $119,610,000. Van ECK Associates Corp acquired a new stake in shares of Red Cat during the 2nd quarter worth approximately $27,193,000. Renaissance Technologies LLC acquired a new stake in shares of Red Cat during the 1st quarter worth approximately $18,533,000. Finally, AWM Investment Company Inc. purchased a new position in shares of Red Cat during the 2nd quarter valued at approximately $9,313,000. 37.97% of the stock is owned by hedge funds and other institutional investors.

Red Cat Company Profile

Red Cat Holdings, Inc is a drone technology company that develops and supplies unmanned aircraft systems for defense, government, public safety and commercial applications. The company focuses on autonomous and remotely operated aerial systems designed to support intelligence, surveillance and reconnaissance missions, including operations in contested or GPS-denied environments.

Red Cat's product portfolio includes the Teal 2 small unmanned aircraft system, a compact drone designed for close-range reconnaissance and situational awareness.

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