Red Cat (NASDAQ:RCAT) Trading Down 2% - Here's What Happened

Key Points

• Red Cat shares fell 2% to $7.80, with about 5.33 million shares traded—59% below the stock’s average daily volume.
• Analyst sentiment remains generally positive, with a consensus “Moderate Buy” rating and an average price target of $18.00, although Needham recently lowered its target from $20 to $15.
• The company missed quarterly expectations, reporting a loss of $0.26 per share versus the $0.21 expected and revenue of $20.20 million versus estimates of $22.65 million; two directors also sold shares totaling $794,850.

Shares of Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report) fell 2% during mid-day trading on Monday . The stock traded as low as $7.64 and last traded at $7.80. Approximately 5,330,021 shares traded hands during trading, a decline of 59% from the average daily volume of 13,060,030 shares. The stock had previously closed at $7.96.

Wall Street Analyst Weigh In

Several analysts recently weighed in on the stock. Needham & Company LLC reduced their price objective on shares of Red Cat from $20.00 to $15.00 and set a "buy" rating on the stock in a research note on Friday, August 7th. Roth Capital initiated coverage on Red Cat in a research report on Monday, June 1st. They set a "buy" rating and a $25.00 target price for the company. UBS Group initiated coverage on Red Cat in a report on Wednesday, May 27th. They set a "buy" rating on the stock. Evercore assumed coverage on Red Cat in a research report on Monday, August 31st. They issued an "outperform" rating and a $15.00 price target on the stock. Finally, Wall Street Zen cut Red Cat from a "sell" rating to a "strong sell" rating in a research note on Saturday, July 18th. Two research analysts have rated the stock with a Strong Buy rating, five have given a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, Red Cat currently has a consensus rating of "Moderate Buy" and an average price target of $18.00.

Red Cat Trading Down 2.0%

The stock's 50-day moving average price is $8.75 and its 200-day moving average price is $11.07. The stock has a market cap of $957.37 million, a price-to-earnings ratio of -9.63 and a beta of 1.35.

Red Cat (NASDAQ:RCAT - Get Free Report) last posted its quarterly earnings data on Thursday, August 6th. The company reported ($0.26) earnings per share for the quarter, missing the consensus estimate of ($0.21) by ($0.05). The firm had revenue of $20.20 million for the quarter, compared to analyst estimates of $22.65 million. Red Cat had a negative return on equity of 32.25% and a negative net margin of 136.26%. As a group, analysts predict that Red Cat Holdings, Inc. will post -0.77 earnings per share for the current year.

Insider Activity

In other news, Director Nicholas Liuzza, Jr. sold 55,000 shares of the business's 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 transaction, the director directly owned 489,874 shares of the company's stock, valued at $5,207,360.62. The trade was a 10.09% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director Christopher Moe sold 20,000 shares of the firm's stock in a transaction that occurred on Tuesday, August 11th. The stock was sold at an average price of $10.51, for a total value of $210,200.00. Following the sale, the director directly owned 200,502 shares of the company's stock, valued at $2,107,276.02. This represents a 9.07% decrease in their position. The disclosure for this sale is available in the SEC filing. Company insiders own 12.50% of the company's stock.

Institutional Trading of Red Cat

Hedge funds have recently modified their holdings of the stock. Allworth Financial LP bought a new position in Red Cat during the second quarter worth $28,000. Fifth Third Bancorp bought a new stake in Red Cat in the first quarter valued at $33,000. NFSG Corp increased its stake 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 purchasing an additional 2,000 shares in the last quarter. PNC Financial Services Group Inc. raised its holdings in shares of Red Cat by 294.6% during the first quarter. PNC Financial Services Group Inc. now owns 3,042 shares of the company's stock valued at $40,000 after purchasing an additional 2,271 shares during the period. Finally, Integrated Wealth Concepts LLC acquired a new position in shares of Red Cat during the second quarter valued at about $42,000. Institutional investors own 37.97% of the company's stock.

About Red Cat

Red Cat Holdings, Inc is a drone technology company that develops and supplies small unmanned aircraft systems for military, government, public safety and commercial applications. Its solutions are designed to support intelligence, surveillance and reconnaissance, situational awareness, and other missions requiring portable and rapidly deployable aerial systems.

Through its Teal Drones business, Red Cat offers the Teal 2 and related Black Widow systems, compact drones designed for defense and public-safety users.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.