Red Cat (NASDAQ:RCAT) Stock Price Down 6.2% - Here's What Happened

Key Points

• Red Cat shares fell 6.2% to $10.44 in Monday trading, with roughly 9.6 million shares changing hands. The decline followed a quarterly earnings miss, as EPS came in at -$0.26 versus a -$0.21 estimate and revenue reached $20.2 million, below the $22.65 million consensus.
• Despite the sell-off, analysts maintain a consensus “Buy” rating with an average price target of $20.40, although Needham reduced its target from $20 to $15. Two analysts rate the stock Strong Buy, four rate it Buy, and one rates it Sell.
• Insiders have sold 240,028 shares worth approximately $2.69 million over the past three months, while institutional investors own 37.97% of the company. Red Cat remains unprofitable, with a negative net margin of 136.26% and analysts forecasting a full-year loss of $0.78 per share.

Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report) fell 6.2% during trading on Monday . The stock traded as low as $10.24 and last traded at $10.44. Approximately 9,575,537 shares traded hands during mid-day trading, a decline of 31% from the average daily volume of 13,912,872 shares. The stock had previously closed at $11.13.

Analyst Ratings Changes

A number of equities research analysts have recently weighed in on the stock. Clear Str raised shares of Red Cat to a "strong-buy" rating in a research note on Wednesday, April 29th. Weiss Ratings reissued a "sell (d-)" rating on shares of Red Cat in a research note on Friday, July 17th. Needham & Company LLC lowered their price objective on shares of Red Cat from $20.00 to $15.00 and set a "buy" rating for the company in a report on Friday, August 7th. LADENBURG THALM/SH SH raised Red Cat to a "strong-buy" rating in a research report on Wednesday, May 6th. Finally, Roth Capital assumed coverage on Red Cat in a report on Monday, June 1st. They set a "buy" rating and a $25.00 target price on the stock. Two analysts have rated the stock with a Strong Buy rating, four have assigned a Buy rating and one has assigned a Sell rating to the company. Based on data from MarketBeat, the stock has a consensus rating of "Buy" and an average price target of $20.40.

Red Cat Stock Down 6.2%

The stock's fifty day simple moving average is $9.51 and its two-hundred day simple moving average is $11.64. The firm has a market cap of $1.28 billion, a PE ratio of -12.89 and a beta of 1.32.

Red Cat (NASDAQ:RCAT - Get Free Report) last released its earnings results on Thursday, August 6th. The company reported ($0.26) earnings per share (EPS) for the quarter, missing the consensus estimate of ($0.21) by ($0.05). The business had revenue of $20.20 million for the quarter, compared to analysts' expectations of $22.65 million. Red Cat had a negative net margin of 136.26% and a negative return on equity of 32.25%. On average, equities research analysts anticipate that Red Cat Holdings, Inc. will post -0.78 earnings per share for the current fiscal year.

Insider Transactions at Red Cat

In other news, Director Paul Funk II sold 165,028 shares of Red Cat stock in a transaction dated Thursday, June 11th. The stock was sold at an average price of $11.50, for a total value of $1,897,822.00. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, Director Christopher R. Moe sold 20,000 shares of the company's stock in a transaction dated Tuesday, August 11th. The stock was sold at an average price of $10.51, for a total transaction of $210,200.00. Following the completion of the transaction, the director owned 200,502 shares in the company, valued at approximately $2,107,276.02. The trade was a 9.07% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last three months, insiders have sold 240,028 shares of company stock valued at $2,692,672. Insiders own 12.50% of the company's stock.

Institutional Trading of Red Cat

A number of institutional investors and hedge funds have recently bought and sold shares of RCAT. Fifth Third Bancorp bought a new position in shares of Red Cat in the first quarter worth approximately $33,000. Allworth Financial LP bought a new stake in shares of Red Cat during the second quarter valued at approximately $28,000. IFP Advisors Inc increased its position 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 valued at $28,000 after acquiring an additional 1,720 shares in the last quarter. NFSG Corp raised its holdings in Red Cat by 200.0% in the 1st quarter. NFSG Corp now owns 3,000 shares of the company's stock worth $39,000 after acquiring an additional 2,000 shares during the last quarter. Finally, PNC Financial Services Group Inc. raised its holdings in Red Cat by 294.6% in the 1st quarter. PNC Financial Services Group Inc. now owns 3,042 shares of the company's stock worth $40,000 after acquiring an additional 2,271 shares during the last quarter. 37.97% of the stock is currently owned by 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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