Red Cat (NASDAQ:RCAT) Shares Gap Up – Should You Buy?

Red Cat Holdings, Inc. (NASDAQ:RCAT) shares gapped up before the market opened on Wednesday . The stock had previously closed at $8.46, but opened at $8.92. Red Cat shares last traded at $8.72, with a volume of 3,049,830 shares changing hands.

Red Cat Stock Performance

The company has a 50-day simple moving average of $9.52 and a two-hundred day simple moving average of $5.12. The company has a quick ratio of 0.60, a current ratio of 1.43 and a debt-to-equity ratio of 0.30. The firm has a market cap of $691.86 million, a PE ratio of -15.97 and a beta of 1.32.

Red Cat (NASDAQ:RCAT) last announced its earnings results on Monday, December 16th. The company reported ($0.18) earnings per share for the quarter, missing analysts’ consensus estimates of $0.09 by ($0.27). Red Cat had a negative return on equity of 96.00% and a negative net margin of 232.62%. During the same period in the prior year, the business earned ($0.11) earnings per share. As a group, equities research analysts forecast that Red Cat Holdings, Inc. will post -0.5 earnings per share for the current year.

Insiders Place Their Bets

In related news, Director Nicholas Reyland Liuzza, Jr. sold 328,928 shares of the business’s stock in a transaction dated Wednesday, December 18th. The stock was sold at an average price of $8.29, for a total transaction of $2,726,813.12. Following the transaction, the director now owns 681,072 shares in the company, valued at $5,646,086.88. The trade was a 32.57 % decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, CEO Jeffrey M. Thompson sold 392,551 shares of the firm’s stock in a transaction on Monday, December 23rd. The stock was sold at an average price of $11.34, for a total value of $4,451,528.34. Following the completion of the sale, the chief executive officer now directly owns 13,121,898 shares of the company’s stock, valued at $148,802,323.32. The trade was a 2.90 % decrease in their position. The disclosure for this sale can be found here. Insiders sold 1,930,441 shares of company stock valued at $21,099,751 over the last three months. Insiders own 21.50% of the company’s stock.

Institutional Trading of Red Cat

A number of hedge funds and other institutional investors have recently modified their holdings of the business. Renaissance Technologies LLC purchased a new stake in Red Cat in the second quarter worth about $267,000. XTX Topco Ltd grew its position in shares of Red Cat by 390.9% during the 2nd quarter. XTX Topco Ltd now owns 58,895 shares of the company’s stock valued at $68,000 after acquiring an additional 46,897 shares during the period. PVG Asset Management Corp acquired a new position in Red Cat in the 2nd quarter worth about $63,000. Sheets Smith Wealth Management acquired a new stake in Red Cat in the third quarter valued at approximately $51,000. Finally, United Capital Management of KS Inc. purchased a new stake in shares of Red Cat in the third quarter valued at approximately $108,000. 37.97% of the stock is owned by hedge funds and other institutional investors.

About Red Cat

Red Cat Holdings, Inc engages in the provision of various products, services, and solutions to the drone industry. The company operates through two segments: Enterprise and Consumer. It built infrastructure to manages drone fleets and fly, and provide services remotely, navigate confined industrial interior spaces and dangerous military environment.