Red Cat (NASDAQ:RCAT) Stock Price Up 8.8% – Should You Buy?

Shares of Red Cat Holdings, Inc. (NASDAQ:RCAT) were up 8.8% on Friday . The company traded as high as $11.76 and last traded at $11.13. 18,320,426 shares changed hands during trading, an increase of 32% from the average session volume of 13,931,162 shares. The stock had previously closed at $10.23.

Key Red Cat News

Here are the key news stories impacting Red Cat this week:

• Positive Sentiment: A reported 100% drone tariff tied to the Trump administration sparked a broad rally in U.S. drone companies. Red Cat gained alongside Unusual Machines (NYSE:UMAC) and Ondas Holdings (NASDAQ:ONDS), making the tariff story the primary near-term catalyst for RCAT. Unusual Machines, Red Cat and Ondas Rally on Drone Tariff
• Positive Sentiment: Red Cat promoted Mitch McDonald to divisional CEO of its UAS operations, bringing Teal Drones and FlightWave Aerospace under unified leadership. The company said the move should improve coordination, manufacturing scale and execution as defense demand expands.
• Neutral Sentiment: Ondas won a multimillion-dollar Israeli defense tender for tactical attack drones, reinforcing the broader demand outlook for autonomous defense systems. However, the award benefits Ondas directly and does not create immediate revenue for Red Cat. Ondas Wins Israeli Defense Tender
• Negative Sentiment: Several Red Cat directors sold shares, including Christopher Moe, who reported sales totaling 30,000 shares, and Nicholas Reyland Liuzza Jr., who sold 55,000 shares. The transactions reduce insider ownership and may temper investor confidence, although both directors retained substantial positions. Red Cat Insider Stock Sales
• Negative Sentiment: Northland Securities lowered its Red Cat third-quarter EPS forecast. The revision follows the company’s latest quarterly miss, when RCAT reported a larger-than-expected loss and revenue below consensus, highlighting ongoing profitability risk.
• Negative Sentiment: Weak quarterly results from Ondas pressured sentiment across parts of the drone sector, creating a potential offset to the tariff-driven optimism. Ondas Drops After Earnings

Wall Street Analysts Forecast Growth

A number of brokerages recently issued reports on RCAT. Weiss Ratings reiterated a “sell (d-)” rating on shares of Red Cat in a research note on Friday, July 17th. Needham & Company LLC dropped their price objective on shares of Red Cat from $20.00 to $15.00 and set a “buy” rating on the stock in a research report on Friday, August 7th. Wall Street Zen lowered shares of Red Cat from a “sell” rating to a “strong sell” rating in a report on Saturday, July 18th. Clear Str raised shares of Red Cat to a “strong-buy” rating in a research report on Wednesday, April 29th. Finally, Roth Capital started coverage on shares of Red Cat in a research note on Monday, June 1st. They set a “buy” rating and a $25.00 target price for the company. Two equities research analysts have rated the stock with a Strong Buy rating, four have assigned a Buy rating and one has issued a Sell rating to the company’s stock. Based on data from MarketBeat.com, the stock has an average rating of “Buy” and an average target price of $20.40.

Red Cat Stock Up 8.8%

The business’s fifty day simple moving average is $9.55 and its two-hundred day simple moving average is $11.66. The company has a market cap of $1.37 billion, a price-to-earnings ratio of -13.74 and a beta of 1.31.

Red Cat (NASDAQ:RCAT) last issued its quarterly earnings data on Thursday, August 6th. The company reported ($0.26) earnings per share for the quarter, missing the consensus estimate of ($0.21) by ($0.05). Red Cat had a negative return on equity of 39.64% and a negative net margin of 136.26%.The company had revenue of $20.20 million for the quarter, compared to analysts’ expectations of $22.65 million. Sell-side analysts predict that Red Cat Holdings, Inc. will post -0.78 EPS for the current fiscal year.

Insider Activity

In related news, 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 value of $210,200.00. Following the completion of the sale, the director directly owned 200,502 shares of the company’s stock, valued at $2,107,276.02. This represents a 9.07% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, Director Nicholas Reyland Liuzza, Jr. sold 55,000 shares of the firm’s stock in a transaction that occurred on Tuesday, August 11th. The stock was sold at an average price of $10.63, for a total value of $584,650.00. Following the transaction, the director owned 489,874 shares in the company, valued at $5,207,360.62. This represents a 10.09% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last three months, insiders sold 240,028 shares of company stock valued at $2,692,672. Insiders own 12.50% of the company’s stock.

Hedge Funds Weigh In On Red Cat

Hedge funds have recently modified their holdings of the business. Legal & General Group Plc acquired a new position in shares of Red Cat in the 2nd quarter valued at $1,232,000. The Manufacturers Life Insurance Company acquired a new stake in Red Cat during the 2nd quarter worth $522,000. Sanctuary Advisors LLC purchased a new position in Red Cat during the 2nd quarter worth $117,000. Connor Clark & Lunn Investment Management Ltd. purchased a new position in Red Cat during the 2nd quarter worth $164,000. Finally, Quantbot Technologies LP acquired a new position in Red Cat in the second quarter valued at $47,000. 37.97% of the stock is currently owned by hedge funds and other 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.