Pomerantz Law Firm Announces the Filing of a Class Action Against Red Cat Holdings, Inc. and Certain Officers

Core Viewpoint - A class action lawsuit has been filed against Red Cat Holdings, Inc. and certain officers for alleged violations of federal securities laws during the Class Period from March 18, 2022, to January 15, 2025, seeking damages for misleading statements regarding the company's business and operations [1][7]. Group 1: Lawsuit Details - The lawsuit is filed in the United States District Court for the District of New Jersey, seeking to recover damages for all persons and entities that purchased Red Cat securities during the Class Period [1]. - Investors have until July 22, 2025, to request to be appointed as Lead Plaintiff for the class [2]. Group 2: Company Overview - Red Cat Holdings, Inc. provides various products and services to the U.S. drone industry, including the "Teal 2" drone designed for nighttime military operations [4]. - The company manufactures its drones through its subsidiary Teal Drones, Inc. at a facility in Salt Lake City, Utah, which was claimed to have the capacity to produce thousands of drones per month [5]. Group 3: Contract and Production Capacity - In March 2022, Red Cat was selected by the U.S. Department of Defense to compete in the Short Range Reconnaissance Program, with the contract potentially worth hundreds of millions to over a billion dollars [6][7]. - However, during a conference call in July 2023, it was revealed that the Salt Lake City Facility could only produce 100 drones per month, contradicting earlier claims [8]. Group 4: Financial Performance and Stock Impact - Following the July 2023 disclosures, Red Cat's stock price fell by $0.10 per share, or 8.93%, closing at $1.02 [9]. - In September 2024, the company reported losses per share of $0.17 and revenue of $2.8 million, missing consensus estimates, leading to a further stock price decline of $0.80 per share, or 25.32% [10][11]. - On January 16, 2025, a report alleged that the value of the SRR Contract was overstated, leading to a stock price drop of $2.35 per share, or 21.54% [13][14].