Analyzing Red Cat (NASDAQ:RCAT) & Workiva (NYSE:WK)

Red Cat (NASDAQ:RCAT) and Workiva (NYSE:WK) are both business services companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, valuation, profitability and risk.

Earnings and Valuation

This table compares Red Cat and Workiva”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Red Cat	$18.86 million	12.23	-$24.05 million	($0.46)	-6.65
Workiva	$678.00 million	6.45	-$127.53 million	($1.72)	-46.37

Red Cat has higher earnings, but lower revenue than Workiva. Workiva is trading at a lower price-to-earnings ratio than Red Cat, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Red Cat has a beta of -0.03, suggesting that its stock price is 103% less volatile than the S&P 500. Comparatively, Workiva has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Red Cat and Workiva, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Cat	0	0	1	0	3.00
Workiva	0	1	5	0	2.83

Red Cat currently has a consensus target price of $4.00, indicating a potential upside of 30.72%. Workiva has a consensus target price of $95.00, indicating a potential upside of 19.11%. Given Red Cat’s stronger consensus rating and higher probable upside, equities analysts clearly believe Red Cat is more favorable than Workiva.

Institutional and Insider Ownership

38.0% of Red Cat shares are held by institutional investors. Comparatively, 92.2% of Workiva shares are held by institutional investors. 21.5% of Red Cat shares are held by company insiders. Comparatively, 3.9% of Workiva shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Red Cat and Workiva’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Red Cat	-162.50%	-66.19%	-58.99%
Workiva	-13.23%	N/A	-6.99%

About Red Cat

Red Cat Holdings, Inc. engages in the provision of various products, services, and solutions to the drone industry. The company operates through two segments: Enterprise and Consumer. It built infrastructure to manages drone fleets and fly, and provide services remotely, navigate confined industrial interior spaces and dangerous military environment. Red Cat Holdings, Inc. is based in San Juan, Puerto Rico.

About Workiva

Workiva Inc., together with its subsidiaries, provides cloud-based reporting solutions in the United States and internationally. The company offers Workiva platform, a multi-tenant cloud software that provides data linking capabilities; audit trail services; administrators access management; and allows customers to connect data from multiple enterprise resource planning, human capital management, and customer relationship management systems, as well as other third-party cloud and on-premise applications. It serves public and private companies, government agencies, and higher-education institutions. Workiva Inc. was founded in 2008 and is headquartered in Ames, Iowa.