Red Cat (NASDAQ:RCAT) Shares Gap Up - Time to Buy?

Key Points

• Shares gapped up pre-market to $13.23 from $12.68 but were last trading around $12.29 after heavy volume (~2.98M shares), reflecting notable intraday volatility (article also notes the stock was down about 6.6%).
• Analyst sentiment is mixed—two Buy ratings and one Sell—leading to a consensus rating of Hold with an average price target of $20.67.
• Fundamentals show an EPS miss (reported ($0.17) vs. ($0.14) expected) while revenue beat at $26.24M; the company has negative margins, a market cap of about $1.44B, and analysts expect roughly -0.5 EPS for the year.

Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report) shares gapped up before the market opened on Monday . The stock had previously closed at $12.68, but opened at $13.23. Red Cat shares last traded at $12.29, with a volume of 2,983,416 shares.

Wall Street Analysts Forecast Growth

A number of equities analysts have recently commented on the stock. Wall Street Zen raised shares of Red Cat from a "sell" rating to a "hold" rating in a report on Saturday, March 21st. Weiss Ratings reissued a "sell (d-)" rating on shares of Red Cat in a research report on Thursday, January 22nd. Needham & Company LLC lifted their price objective on shares of Red Cat from $16.00 to $20.00 and gave the company a "buy" rating in a research note on Thursday, March 19th. LADENBURG THALM/SH SH upped their target price on shares of Red Cat from $15.00 to $20.00 and gave the company a "buy" rating in a report on Tuesday, March 3rd. Finally, Northland Securities set a $22.00 target price on shares of Red Cat in a research note on Tuesday, January 20th. Two equities research analysts have rated the stock with a Buy rating and one has given a Sell rating to the company's stock. According to data from MarketBeat, the stock presently has a consensus rating of "Hold" and an average price target of $20.67.

Red Cat Stock Down 6.6%

The stock has a fifty day moving average price of $14.05 and a 200-day moving average price of $11.41. The firm has a market cap of $1.44 billion, a price-to-earnings ratio of -15.80 and a beta of 1.53.

Red Cat (NASDAQ:RCAT - Get Free Report) last posted its quarterly earnings data on Wednesday, March 18th. The company reported ($0.17) earnings per share for the quarter, missing analysts' consensus estimates of ($0.14) by ($0.03). The firm had revenue of $26.24 million during the quarter, compared to analysts' expectations of $24.50 million. Red Cat had a negative net margin of 176.96% and a negative return on equity of 38.86%. As a group, research analysts expect that Red Cat Holdings, Inc. will post -0.5 earnings per share for the current year.

Institutional Inflows and Outflows

Several large investors have recently added to or reduced their stakes in RCAT. Brevan Howard Capital Management LP purchased a new position in Red Cat in the third quarter worth $19,739,000. Tudor Investment Corp ET AL boosted its position in shares of Red Cat by 214.0% during the 3rd quarter. Tudor Investment Corp ET AL now owns 1,277,523 shares of the company's stock worth $13,222,000 after purchasing an additional 870,612 shares in the last quarter. AWM Investment Company Inc. boosted its position in shares of Red Cat by 15.3% during the 2nd quarter. AWM Investment Company Inc. now owns 2,037,616 shares of the company's stock worth $14,834,000 after purchasing an additional 269,942 shares in the last quarter. Kornitzer Capital Management Inc. KS acquired a new position in shares of Red Cat during the 3rd quarter worth $880,000. Finally, Geode Capital Management LLC increased its holdings in shares of Red Cat by 142.7% in the 2nd quarter. Geode Capital Management LLC now owns 1,656,720 shares of the company's stock valued at $12,063,000 after purchasing an additional 974,121 shares in the last quarter. 37.97% of the stock is owned by hedge funds and other institutional investors.

Red Cat Company Profile

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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