Needham Cuts Red Cat Holdings Inc. (RCAT)’s Price Target To $12, Maintains Buy Rating

Red Cat Holdings, Inc. (NASDAQ:RCAT) is among the 8 Best Small-Cap Defense Stocks to Buy Right Now. On November 14, Needham analyst Austin Bohlig lowered his price target on the stock to $12 from $17.

In a research note to investors, the analyst highlighted the company’s strong third-quarter results for fiscal 2025, while noting that the revised revenue guidance for the full year was well short of analysts’ estimates. The company’s guidance revision was attributed to the delay in the launch of a new product and the government shutdown.

However, Needham maintained its Buy rating for Red Cat Holdings, Inc. (NASDAQ:RCAT). The firm believes the Short Range Reconnaissance Tranche 2 (SRR T2) program remains a significant opportunity for the company, despite the contract likely being delayed until Q1 of 2026.

RCAT’s shares have plunged nearly 48% year-to-date, which Bohlig believes presents a buying opportunity for investors, as he anticipates the beginning of a promising spell for the company, given prospects in the USV market and the SRR T2 program.

Red Cat Holdings, Inc. (NASDAQ:RCAT)’s quarterly revenue surged 646% from the prior year’s period to $9.6 million during the third quarter. Its diluted loss per share remained at $0.16, unchanged year over year. The company ended the quarter with $212.5 million in cash and receivables.

For the fourth quarter, the company has projected revenue of $20 million to $23 million. If executed, this quarterly revenue will even exceed the company’s highest 12-month revenue.

Red Cat Holdings, Inc. (NASDAQ:RCAT) provides services and solutions for the drone industry.

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