Analyzing Red Cat (NASDAQ:RCAT) and Code Rebel (OTCMKTS:CDRBQ)

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for Red Cat and Code Rebel, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Red Cat	0	0	1	0	3.00
Code Rebel	0	0	0	0	N/A

Red Cat presently has a consensus target price of $4.00, suggesting a potential upside of 26.98%. Given Red Cat’s higher probable upside, equities research analysts clearly believe Red Cat is more favorable than Code Rebel.

Earnings & Valuation

This table compares Red Cat and Code Rebel”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Red Cat	$18.86 million	12.40	-$24.05 million	($0.52)	-6.06
Code Rebel	N/A	N/A	N/A	N/A	N/A

Code Rebel has lower revenue, but higher earnings than Red Cat.

Volatility and Risk

Red Cat has a beta of -0.03, indicating that its share price is 103% less volatile than the S&P 500. Comparatively, Code Rebel has a beta of -16.58, indicating that its share price is 1,758% less volatile than the S&P 500.

Profitability

This table compares Red Cat and Code Rebel’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%
Code Rebel	N/A	N/A	N/A

Insider and Institutional Ownership

38.0% of Red Cat shares are held by institutional investors. 30.5% of Red Cat shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Red Cat beats Code Rebel on 6 of the 9 factors compared between the two stocks.

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 Code Rebel

Code Rebel Corporation operates as a software and information technology (IT) services company. It operates in two segments, Software and IT Services. The Software segment develops, markets, and licenses interactive remote application terminal services solution (iRAPP). The iRAPP allows personal computers users to use applications on a single Mac remote desktop simultaneously via the iRAPP client or any standard compliant remote desktop protocol client. This segment offers iRAPP client-side products for Mac OS X and Windows applications; iRAPP terminal server products, including iRAPP-single-user remote desktop and iRAPP-TS multiple-user terminal server for Mac OS X applications; and iRAPP access products, such as iRAPP Load Balancer and iRAPP Gateway. The IT Services segment provides Independent Software Vendor relationships (ISVs)/channel partner platforms, which provide project management, application, and technical consulting, as well as database administration for implementing projects and managed-services engagements; and professional services consulting that implements, upgrades, and maintains software packages those ISVs offer to their clients. Code Rebel Corporation was founded in 2007 and is based in Kahului, Hawaii.