Piper Sandler initiates Red Cat stock with neutral rating at $9
Piper Sandler has assigned a neutral rating to Red Cat Holdings Inc. (NASDAQ:RCAT) with a price target of $9.00. Red Cat is a provider of drones and unmanned systems catering to military and government customers. The company's Black Widow product was chosen by the U.S. Army for its Short Range Reconnaissance program in late 2024, with deliveries commencing in the fiscal year 2025.
The U.S. Army represented 73% of Red Cat's revenue in fiscal year 2025. Over the past year, Red Cat has experienced a substantial expansion, driven by major acquisitions and a 5x increase in manufacturing footprint, resulting in a revenue growth of 334% to $71.54 million. Analysts anticipate continued sales growth in the current year, contingent upon the adoption of systems beyond the Army or another significant order from the Short Range Reconnaissance (SRR) program.
Currently trading at $8.25, the stock is marginally above InvestingPro's Fair Value estimate, indicating limited upside at present.
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