Red Violet (NasdaqCM:RDVT) - Share price, News & Analysis

RDVT fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	0/6
Past Performance	2/6
Financial Health	6/6
Dividends	0/6

RDVT Stock Overview

Red Violet, Inc., a software and services company, specializes in proprietary technologies and applying analytical capabilities to deliver identity intelligence in the United States.

Rewards

Trading at 21.2% below our estimate of its fair value

Became profitable this year

Risk Analysis

Large one-off items impacting financial results

Shareholders have been diluted in the past year

Red Violet Competitors

TransUnion

NYSE:TRU

US$15.7b

Thomson Reuters

TSX:TRI

CA$60.5b

Palantir Technologies

NYSE:PLTR

US$16.5b

Price History & Performance

Summary of all time highs, changes and price drops for Red Violet
Historical stock prices
Current Share Price	US$23.02
52 Week High	US$42.48
52 Week Low	US$19.61
Beta	1.01
1 Month Change	-15.71%
3 Month Change	-15.46%
1 Year Change	5.60%
3 Year Change	79.01%
5 Year Change	n/a
Change since IPO	-50.39%

Shareholder Returns

	RDVT	US Professional Services	US Market
7D	-4.6%	-1.3%	-2.7%
1Y	5.6%	-16.4%	-12.9%

Return vs Industry: RDVT exceeded the US Professional Services industry which returned -16.4% over the past year.

Return vs Market: RDVT exceeded the US Market which returned -12.9% over the past year.

Price Volatility

Is RDVT's price volatile compared to industry and market?
RDVT volatility
RDVT Average Weekly Movement	10.4%
Professional Services Industry Average Movement	6.9%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	2.9%

Stable Share Price: RDVT is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 10% a week.

Volatility Over Time: RDVT's weekly volatility (10%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2017	139	Derek Dubner	https://www.redviolet.com

Red Violet, Inc., a software and services company, specializes in proprietary technologies and applying analytical capabilities to deliver identity intelligence in the United States. It offers idiCORE, an investigative solution used to address various organizational challenges, which include due diligence, risk mitigation, identity authentication, and regulatory compliance; and FOREWARN, an app-based solution that provides instant knowledge before face-to-face engagement with a consumer, as well as helps professionals to identify and mitigate risk. The company serves financial services, insurance, healthcare, retail, and telecommunication companies; law enforcement and government agencies; and collections, corporate security, and investigative firms, as well as solutions used for purposes, such as risk mitigation, due diligence, fraud detection and prevention, regulatory compliance, and customer acquisition.

Red Violet Fundamentals Summary

How do Red Violet's earnings and revenue compare to its market cap?
RDVT fundamental statistics
Market Cap	US$311.30m
Earnings (TTM)	US$1.34m
Revenue (TTM)	US$46.53m

232.3x

P/E Ratio

6.7x

P/S Ratio

Is RDVT overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
RDVT income statement (TTM)
Revenue	US$46.53m
Cost of Revenue	US$11.60m
Gross Profit	US$34.93m
Other Expenses	US$33.59m
Earnings	US$1.34m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.099
Gross Margin	75.06%
Net Profit Margin	2.88%
Debt/Equity Ratio	0%

How did RDVT perform over the long term?

See historical performance and comparison

Valuation

Is Red Violet undervalued compared to its fair value and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

21.2%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: RDVT ($23.02) is trading below our estimate of fair value ($29.2)

Significantly Below Fair Value: RDVT is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: RDVT is poor value based on its PE Ratio (232.3x) compared to the US Professional Services industry average (16.5x).

PE vs Market: RDVT is poor value based on its PE Ratio (232.3x) compared to the US market (15.2x).

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RDVT's PEG Ratio to determine if it is good value.

Price to Book Ratio

PB vs Industry: RDVT is overvalued based on its PB Ratio (4.4x) compared to the US Professional Services industry average (2.5x).

Future Growth

How is Red Violet forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

22.2%

Forecasted Commercial Services industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Red Violet has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

Past Performance

How has Red Violet performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

41.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: RDVT has a large one-off gain of $2.2M impacting its March 31 2022 financial results.

Growing Profit Margin: RDVT became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: RDVT has become profitable over the past 5 years, growing earnings by 41.7% per year.

Accelerating Growth: RDVT has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: RDVT has become profitable in the last year, making it difficult to compare its past year earnings growth to the Professional Services industry (32.6%).

Return on Equity

High ROE: RDVT's Return on Equity (1.9%) is considered low.

Financial Health

How is Red Violet's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: RDVT's short term assets ($40.4M) exceed its short term liabilities ($4.0M).

Long Term Liabilities: RDVT's short term assets ($40.4M) exceed its long term liabilities ($1.5M).

Debt to Equity History and Analysis

Debt Level: RDVT is debt free.

Reducing Debt: RDVT had no debt 5 years ago.

Debt Coverage: RDVT has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: RDVT has no debt, therefore coverage of interest payments is not a concern.

Balance Sheet

Dividend

What is Red Violet current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate RDVT's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate RDVT's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if RDVT's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RDVT's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as RDVT has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.8yrs

Average management tenure

CEO

Derek Dubner (49 yo)

4.75yrs

Tenure

US$1,667,768

Compensation

Mr. Derek Dubner serves as Chairman of the Board at Red Violet, Inc. since April 2020 and has been its Chief Executive Officer and also Director since August 2017. He had been Interim Chairman of Red Viole...

CEO Compensation Analysis

Compensation vs Market: Derek's total compensation ($USD1.67M) is below average for companies of similar size in the US market ($USD2.59M).

Compensation vs Earnings: Derek's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: RDVT's management team is considered experienced (4.8 years average tenure).

Board Members

Experienced Board: RDVT's board of directors are not considered experienced ( 0.7 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 10.5%.

Data	Last Updated (UTC time)
Company Analysis	2022/05/22 00:00
End of Day Share Price	2022/05/20 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31