* Note: Prices are in Million (M) USD.
Description:
Red Cat Holdings, Inc. is an innovative provider of advanced products, services, and solutions tailored for the rapidly evolving drone industry. Headquartered in Humacao, Puerto Rico, the company leverages cutting-edge technology to deliver enhanced capabilities across various sectors, including commercial, governmental, and recreational applications. With a strategic focus on expanding its market presence and fostering partnerships, Red Cat is well-positioned to capitalize on the increasing demand for drone-related solutions in a global marketplace.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $66 M
Debt : $20 M
EBITDA : $-51 M
Since Ebitda is less than 0, 0 points assigned.
This criteria used industry in which company operates:
Sector: Energy & transportation
Industry: Crude petroleum & natural gas
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 150.86
Since Forward PE Ratio is greater than 35, 0 point assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $-5 M
Average Revenue: $2 M
Revenue Converted To Free Cash Flow (%): -202.7%
Since Free Cash Flow (FCF) to Revenue percentage is non-positive, 0 point assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2025-04-30): $7 M
Revenue 5 Years Ago (2020-04-30): $0 M
Total Growth over 5 Years: 1,701.1%
5-Year Revenue CAGR (Historical): 78.3%
Forward 5-Year CAGR (Tapered): 39.1%
Since historical Revenue CAGR is greater than 20, 5 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2025-04-30): $77 M
Share Count 5 Years Ago (2021-04-30): $24 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $0.07
Trailing 12-Month Earnings Per Share (EPS): $0.00
Average Earnings Per Share (EPS): $0.07
Dividend Per Share (DPS): $0
Payout Ratio: 0%
Dividend Yield: 0.00%
Since Dividend Per Share is less than or equal to 0, 0 point assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 9 valid ROE years (max 20).Average ROE: 62.1%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $10.56
52-Week Low: $2.97
Threshold Price (15% Above 52-Week Low): $3.42
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $1,343 M
Since Market Cap is less than 10B, 1 point assigned.
% Exposure to Total Portfolio
Based on high P/E, we recommend do not exceed 0.20% exposure of Total Portfolio.
Warren Buffett's Owners' Earnings:
No positive free cash flow found (TTM or annual) to compute Owners' Earnings per share.
Note: Many fast-growing companies reinvest heavily, so Owners' Earnings may appear low.
Consider other factors in your valuation.
Value-Trade has assigned 14 points to above Red Cat Holdings Inc (RCAT) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• Growth Based PE 50.00 (>2× median)
• ROE Based PE 50.00 (>2× median)
Further research is recommended; please use your own due diligence.
In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Fair Value PE
12, Industry Based PE
13, Growth Based PE
50, ROE Based PE
50, Risk-Free Anchored PE (25% MoS)
18.2. Based on these 5 values, average assigned is
28.64. Value-Trades has assined P/E value
28.57. An average (Current Year EPS + Next Year EPS) earning per share is
$0.07.
Note: Final fair value is the lesser of the blended PE-based fair value and the simple average PE × EPS fair value.Fair value using multiple P/Es (blended): $2.00 (PE 28.64 × EPS $0.07)
Fair value using simple average PE × EPS: $2.00 (PE 28.64 × EPS $0.07)
Lesser of these two: $2.00
So the Final Fair Value is: $2.00
Understanding the Value-Trades P/E Blend (click to expand)
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What goes into the blended P/E?
- 20-Year Avg P/E — Long-run market baseline; conservative anchor.
- Fair Value P/E — Score-based (cash, debt, sector, etc.).
- Industry P/E — Peer group norm.
- Growth-Based P/E — Uses tapered growth rates, floored at 15.
- RCFC-Based P/E — Maps cash conversion efficiency.
- ROE-Based P/E — Higher ROE supports higher multiples.
- Risk-Free Anchored P/E — Macro floor tied to 10y yield w/ MoS.
How it works
- Extreme values are clamped/filtered (IQR method).
- Anchors (20y avg, RCFC/ROE, risk-free) are always kept if valid.
- Final fair value = min(Blended PE × EPS, Avg PE × EPS).
P/E Reference Summary
Using EPS: $0.07
| Source |
P/E Ratio |
Implied Fair Value |
| Value-Trades Assigned | 28.57 | $2.00 |
