Red Cat (NASDAQ:RCAT) Shares Gap Down – Should You Sell?

Red Cat Holdings, Inc. (NASDAQ:RCAT)’s share price gapped down prior to trading on Monday . The stock had previously closed at $8.79, but opened at $8.20. Red Cat shares last traded at $8.14, with a volume of 2,267,429 shares trading hands.

Red Cat Stock Performance

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 fifty day simple moving average of $10.04 and a 200-day simple moving average of $5.63.

Red Cat (NASDAQ:RCAT) last issued its earnings results on Monday, December 16th. The company reported ($0.18) earnings per share (EPS) 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 firm earned ($0.11) earnings per share. Equities research analysts anticipate that Red Cat Holdings, Inc. will post -0.5 earnings per share for the current year.

Insider Buying and Selling

In related news, CEO Jeffrey M. Thompson sold 392,551 shares of the 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 approximately $148,802,323.32. This represents a 2.90 % decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, Director Joseph David Freedman sold 15,000 shares of Red Cat stock in a transaction on Monday, December 30th. The stock was sold at an average price of $14.24, for a total transaction of $213,600.00. Following the transaction, the director now directly owns 585,190 shares in the company, valued at $8,333,105.60. This represents a 2.50 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders have sold 1,930,441 shares of company stock worth $21,099,751 in the last quarter. Insiders own 21.50% of the company’s stock.

Institutional Trading of Red Cat

Several institutional investors and hedge funds have recently made changes to their positions in RCAT. Renaissance Technologies LLC bought a new stake in Red Cat in the 2nd quarter worth about $267,000. Corsair Capital Management L.P. purchased a new position in shares of Red Cat in the 3rd quarter worth approximately $308,000. Wolverine Trading LLC bought a new position in shares of Red Cat in the third quarter valued at approximately $233,000. Centiva Capital LP purchased a new stake in shares of Red Cat during the third quarter valued at approximately $207,000. Finally, State Street Corp lifted its holdings in Red Cat by 44.9% during the third quarter. State Street Corp now owns 221,958 shares of the company’s stock worth $564,000 after acquiring an additional 68,800 shares during the period. Hedge funds and other institutional investors own 37.97% of the company’s stock.

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.