Red Cat (NASDAQ:RCAT) Trading 9.7% Higher - Time to Buy?

Key Points

• Red Cat shares jumped 9.7% to $8.26 in mid-day trading, with a market capitalization of approximately $1.01 billion.
• Analyst sentiment is generally positive: two analysts rate the stock Strong Buy, four rate it Buy, and one rates it Sell, producing an average Buy rating and a $21.40 price target.
• The company’s latest quarter showed sharply higher revenue, up 849.1% year over year to $15.47 million, but Red Cat missed EPS and revenue estimates and continues to report substantial losses and negative margins.

Shares of Red Cat Holdings, Inc. (NASDAQ:RCAT - Get Free Report) were up 9.7% during mid-day trading on Monday . The company traded as high as $8.28 and last traded at $8.26. 9,071,476 shares traded hands during trading, a decline of 35% from the average session volume of 14,051,607 shares. The stock had previously closed at $7.53.

Wall Street Analyst Weigh In

RCAT has been the topic of several research reports. HC Wainwright assumed coverage on shares of Red Cat in a research report on Wednesday, May 27th. They issued a "buy" rating and a $20.00 price objective on the stock. UBS Group assumed coverage on shares of Red Cat in a report on Wednesday, May 27th. They set a "buy" rating on the stock. LADENBURG THALM/SH SH upgraded Red Cat to a "strong-buy" rating in a research report on Wednesday, May 6th. Clear Str raised shares of Red Cat to a "strong-buy" rating in a report on Wednesday, April 29th. Finally, Wall Street Zen lowered shares of Red Cat from a "sell" rating to a "strong sell" rating in a report on Saturday, July 18th. 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's stock. According to data from MarketBeat.com, Red Cat has an average rating of "Buy" and an average target price of $21.40.

Red Cat Trading Up 9.7%

The firm has a market capitalization of $1.01 billion, a P/E ratio of -11.80 and a beta of 1.29. The business's 50 day simple moving average is $10.18 and its two-hundred day simple moving average is $11.99.

Red Cat (NASDAQ:RCAT - Get Free Report) last announced its earnings results on Thursday, May 7th. The company reported ($0.22) EPS for the quarter, missing analysts' consensus estimates of ($0.12) by ($0.10). Red Cat had a negative return on equity of 35.86% and a negative net margin of 138.36%.The company had revenue of $15.47 million during the quarter, compared to the consensus estimate of $17.63 million. The firm's quarterly revenue was up 849.1% on a year-over-year basis. Analysts predict that Red Cat Holdings, Inc. will post -0.68 EPS for the current fiscal year.

Insider Buying and Selling

In related news, Director Paul Funk II sold 165,028 shares of the company's stock in a transaction dated Thursday, June 11th. The shares were 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 through the SEC website. 12.50% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Red Cat

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. 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 buying an additional 1,720 shares during the period. Fifth Third Bancorp purchased a new position in Red Cat during the first quarter worth approximately $33,000. California State Teachers Retirement System acquired a new stake in Red Cat during the second quarter worth about $34,000. NFSG Corp lifted its position 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 buying an additional 2,000 shares during the last quarter. Finally, PNC Financial Services Group Inc. boosted its position in shares of Red Cat by 294.6% during the 1st quarter. PNC Financial Services Group Inc. now owns 3,042 shares of the company's stock worth $40,000 after purchasing an additional 2,271 shares during the period. Hedge funds and other institutional investors own 37.97% of the company's stock.

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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