Red Cat (NASDAQ:RCAT) Stock Price Down 8.5% - Should You Sell?

Key Points

• Red Cat (NASDAQ: RCAT) slid 8.5% mid-day to about $11.93, trading roughly 11.2 million shares (about 32% below its average daily volume) after previously closing at $13.04.
• Wall Street sentiment is mixed with a MarketBeat consensus of "Hold" and an average price target of $20.67 (two Buy ratings vs. one Sell), while individual targets range up to $22.00.
• The company reported a quarterly EPS miss (‑$0.17 vs. ‑$0.14 est.) but revenue of $26.24M beat estimates; Red Cat remains unprofitable with a negative net margin (~176.96%) and analysts expect about ‑0.5 EPS for the year.

Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report) dropped 8.5% during mid-day trading on Thursday . The stock traded as low as $11.76 and last traded at $11.93. Approximately 11,198,020 shares changed hands during mid-day trading, a decline of 32% from the average daily volume of 16,354,145 shares. The stock had previously closed at $13.04.

Wall Street Analyst Weigh In

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

Red Cat Stock Down 8.5%

The company's 50-day moving average is $13.60 and its two-hundred day moving average is $11.51. The company has a market capitalization of $1.45 billion, a P/E ratio of -15.91 and a beta of 1.46.

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 the consensus estimate of ($0.14) by ($0.03). The company had revenue of $26.24 million during the quarter, compared to the consensus estimate of $24.50 million. Red Cat had a negative return on equity of 38.86% and a negative net margin of 176.96%. On average, sell-side analysts predict that Red Cat Holdings, Inc. will post -0.5 EPS for the current year.

Institutional Inflows and Outflows

A number of institutional investors and hedge funds have recently bought and sold shares of RCAT. IFP Advisors Inc grew its position in 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 during the last quarter. Montag A & Associates Inc. boosted its stake in shares of Red Cat by 552.0% during the third quarter. Montag A & Associates Inc. now owns 3,260 shares of the company's stock valued at $34,000 after purchasing an additional 2,760 shares during the period. California State Teachers Retirement System purchased a new stake in shares of Red Cat during the second quarter valued at approximately $34,000. Global Retirement Partners LLC purchased a new stake in shares of Red Cat during the third quarter valued at approximately $36,000. Finally, N.E.W. Advisory Services LLC boosted its stake in shares of Red Cat by 163.5% during the fourth quarter. N.E.W. Advisory Services LLC now owns 5,356 shares of the company's stock valued at $42,000 after purchasing an additional 3,323 shares during the period. 37.97% of the stock is currently owned by institutional investors.

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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