Red Cat Holdings Stock Beneish M Score
| RCAT Stock | USD 1.12 0.06 5.66% |
Red | Beneish M Score |
At this time, it appears that Red Cat Holdings is an unlikely manipulator. The earnings manipulation may begin if Red Cat's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Red Cat executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Red Cat's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.54
Beneish M Score - Unlikely Manipulator
Red Cat Beneish M-Score Indicator Trends
The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Red Cat's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
| Current Value | Last Year | Change From Last Year | 10 Year Trend | ||||||
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| Net Receivables | 1.1 M | 1.1 M |
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| Total Assets | 72.7 M | 69.2 M |
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| Total Current Assets | 38.9 M | 37 M |
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| Non Current Assets Total | 33.8 M | 32.2 M |
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| Property Plant Equipment | 1.7 M | 3 M |
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| Depreciation And Amortization | 1.2 M | 1.1 M |
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| Selling General Administrative | 1.7 M | 1.6 M |
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| Total Current Liabilities | 5.7 M | 5.5 M |
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| Non Current Liabilities Total | 1.4 M | 946.3 K |
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| Short Term Debt | 746 K | 1.4 M |
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| Long Term Debt | 715.7 K | 361.4 K |
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Red Cat Holdings Beneish M-Score Driver Matrix
One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Red Cat's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Red Cat in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Red Cat's degree of accounting gimmicks and manipulations.
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About Red Cat Beneish M Score
M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.
Depreciation And Amortization |
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Red Cat Earnings Manipulation Drivers
Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Red Cat. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 (projected) | ||
| Net Receivables | 3.0K | 396.7K | 913.1K | 932.6K | 1.1M | 1.1M | |
| Total Revenue | 105.1K | 403.9K | 5.0M | 6.4M | 9.9M | 99.9K | |
| Total Assets | 2.8M | 11.7M | 85.1M | 60.2M | 69.2M | 72.7M | |
| Total Current Assets | 318.3K | 1.6M | 55.7M | 32.2M | 37.0M | 38.9M | |
| Net Debt | 332.1K | 1.7M | (1.1M) | (1.2M) | (1.1M) | (1.0M) | |
| Short Term Debt | 118.8K | 269.0K | 1.3M | 1.3M | 1.4M | 746.0K | |
| Operating Income | (2.2M) | (1.7M) | (4.9M) | (13.0M) | (27.1M) | (2.3M) | |
| Investments | (849.8K) | 46.3K | (48.4K) | (57.6M) | 29.6M | (892.3K) |
About Red Cat Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Red Cat Holdings's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Red Cat using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Red Cat Holdings based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Red Cat in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Red Cat's short interest history, or implied volatility extrapolated from Red Cat options trading.
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When determining whether Red Cat Holdings is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Red Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Red Cat Holdings Stock. Highlighted below are key reports to facilitate an investment decision about Red Cat Holdings Stock:Check out Red Cat Piotroski F Score and Red Cat Altman Z Score analysis. Note that the Red Cat Holdings information on this page should be used as a complementary analysis to other Red Cat's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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When running Red Cat's price analysis, check to measure Red Cat's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Red Cat is operating at the current time. Most of Red Cat's value examination focuses on studying past and present price action to predict the probability of Red Cat's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Red Cat's price. Additionally, you may evaluate how the addition of Red Cat to your portfolios can decrease your overall portfolio volatility.
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Is Red Cat's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Red Cat. If investors know Red will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Red Cat listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share (0.50) | Revenue Per Share 0.326 | Quarterly Revenue Growth 2.507 | Return On Assets (0.23) | Return On Equity (0.47) |
The market value of Red Cat Holdings is measured differently than its book value, which is the value of Red that is recorded on the company's balance sheet. Investors also form their own opinion of Red Cat's value that differs from its market value or its book value, called intrinsic value, which is Red Cat's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Red Cat's market value can be influenced by many factors that don't directly affect Red Cat's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Red Cat's value and its price as these two are different measures arrived at by different means. Investors typically determine if Red Cat is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Red Cat's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.