Forensic Analysis · Technology / Software · as of Sep 25, 2026
Red Cat Holdings, Inc. (RCAT)
A forensic read on Red Cat Holdings, Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
D · Weak — demands caution
Forensic grade
Grey Zone
Financial health
13.7
Distress distance
Clean
Earnings quality
6
Forensic signals
-7.8
P / E (ttm)
-29.3%
ROE
$1.0B
Market cap
0.00%
Dividend yield
742.1%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence, going concern, valuation). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Red Cat Holdings, Inc. earns a D (Weak — demands caution) forensic quality grade, and its balance-sheet distress test reads 13.7, placing it in the Grey zone. 6 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of noa).
What the filings flag
+131.9%
FY2024→FY2025
Accruals ratio (% of NOA).Net operating assets grew +131.9% relative to their own average in FY2025 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building sharply — a large slice of profit sits in operating assets, not cash. An accrual is a claim that still has to be collected or written down, so the gap resolves in a later period whichever way it goes. The build is led by receivables up +5249% on the year and PP&E up +315% on the year. A cash-flow measure on the same base agrees: reported earnings ran ahead of operating cash by 12% of net operating assets, against an accruals ratio of 131.9%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average.
+28.3%/yr
FY2023–FY2025
Share-count dilution.Diluted share count changed +65% over the last 2 years to FY2025 (+28.3%/yr). The count is growing: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~28.3% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2023 has been diluted ~39%.
-$106.9M
FY2023 and FY2025
Cash burn vs. reported loss.Over FY2023 and FY2025, the company reported a cumulative net loss of $96.1M against operating cash flow of -$106.9M. Cash burn ran heavier than the reported loss — something outside net income (working capital, a cash item not in the P&L) is consuming cash faster than the loss alone implies.
234d DSO
FY2023→FY2025
Key fundamentals
Latest Revenue$40.7M
Revenue CAGR (2yr)+64.0%
Net Margin-177.0%
Free Cash Flow-$95.8M
Return on Equity-29.3%
Debt / Equity0.00x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Red Cat Holdings, Inc.'s actual 10-K/10-Q/8-K filings?
Data from SEC EDGAR public filings · metrics as of Sep 25, 2026. Forensic signals flag probability, not certainty.
Red Cat Holdings, Inc. (RCAT) Stock — Forensic Analysis, Red Flags & Rating | Stockonomy · Stockonomy
Receivables vs revenue.
Days sales outstanding moved from 89 to 234 days FY2023→FY2025 (receivables +500% vs revenue +128%). Receivables grew, but deferred revenue grew +384% over the same period too — rising alongside rising unearned revenue reads as upfront billing on multi-period contracts, not slipping collections. FY2023 and FY2025 aren't consecutive filed years here, so FY2025's opening balance can't be taken from FY2023 — both figures are measured on period-end balances rather than the beginning-plus-ending average, which keeps the two endpoints comparable to each other.
217d
FY2023→FY2025
Inventory days.Days inventory outstanding moved from 206 to 217 FY2023→FY2025 (against cost of goods sold; inventory +193% vs +179% in cost of sales). Inventory is building a little faster than sales — watch for markdowns. FY2023 and FY2025 aren't consecutive filed years here, so FY2025's opening balance can't be taken from FY2023 — both figures are measured on period-end balances rather than the beginning-plus-ending average, which keeps the two endpoints comparable to each other.
26% of rev
FY2025
Stock-based comp load.Stock-based compensation ran 26% of revenue in FY2025 — about $0.11 per diluted share. It is a real cost, but it is not a cash cost — no cash left the business, which is why operating cash flow adds it back. Where a compensation charge lands instead is the share count, and this filer's count is not on file in enough years to say how the count moved.