Red Violet (RDVT) AI Stock Analysis

• Market Cap: $671.07M
• Dividend Yield: N/A
• Average Volume (3M): 91.35K
• Price to Earnings (P/E): 79.7
• Beta (1Y): 1.00
• Revenue Growth: 22.14%
• EPS Growth: -45.14%
• Country: US
• Employees: 215
• Sector: Technology
• Sector Strength: 83
• Industry: Software - Application
• EPS (TTM): 0.28
• Shares Outstanding: 13,977,738
• 10 Day Avg. Volume: 100,598
• 30 Day Avg. Volume: 91,348
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.01
• Enterprise Value/Revenue: 8.25
• Enterprise Value/Gross Profit: 10.34
• Enterprise Value/Ebitda: 33.03
• 1Y Price Target: $60.00
• Price Target Upside: 21.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 76 Outperform
• Price Target: $56.00 ▲(13.66% Upside)

Red Violet's strong financial performance and positive earnings call sentiment are the primary drivers of its stock score. The company's robust revenue growth, profitability, and strategic initiatives in AI and data enhance its outlook. However, the high P/E ratio suggests overvaluation, and technical indicators warn of potential short-term pullbacks.

Red Violet Business Overview & Revenue Model

Company Description

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. It markets its products and services through value-added distributors, resellers, and strategic partners; and trade shows and seminars, advertising, public relations, distribution of sales literature, and product specifications and ongoing communication with prospective customers, distributors, resellers, strategic partners, and installed base of current customers, as well as through direct sales. Red Violet, Inc. was incorporated in 2017 and is headquartered in Boca Raton, Florida.

How the Company Makes Money

Red Violet generates revenue primarily through its subscription-based model, where clients pay for access to its suite of data analytics and identity verification tools. Key revenue streams include licensing fees from software products, transaction fees for processed identity verifications, and consulting services for implementation and integration of their solutions. Additionally, the company may engage in strategic partnerships with other technology providers and financial institutions, enhancing its service offerings and expanding its customer base, which contributes to its overall earnings.

Red Violet Financial Statement Overview

Summary

Red Violet demonstrates strong financial health with consistent revenue and profit growth, efficient cost management, and robust cash flow generation. The company maintains a low debt level, indicating financial stability, though vigilance in liquidity management is advised.

Income Statement

Red Violet's income statement shows impressive growth trends. The company experienced a robust revenue growth rate of 5.98% from the previous year, with a gross profit margin of 85.41% and a strong net profit margin of 10.87% in the TTM period. EBIT and EBITDA margins have improved significantly to 12.73% and 25.47% respectively, indicating enhanced operational efficiency. These metrics highlight strong profitability and efficient cost management.

Balance Sheet

The balance sheet reflects a strong equity position with a Debt-to-Equity Ratio of 0.02, indicating low leverage. Return on Equity stands at 9.43%, suggesting effective use of equity to generate profits. The Equity Ratio is high at 92.68%, highlighting financial stability. However, the relatively low total asset base compared to liabilities suggests a potential risk in liquidity management.

Cash Flow

Cash flow analysis reveals positive trends, with a solid free cash flow growth rate of -26.74% due to previous high levels, yet still maintaining a healthy free cash flow generation of $17.43 million in the TTM period. The Operating Cash Flow to Net Income Ratio is 2.85, indicating robust cash generation relative to profits. These figures showcase strong cash flow health, supporting future growth and stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	82.40M	75.19M	60.20M	53.32M	44.02M	34.59M
Gross Profit	65.80M	61.19M	47.13M	41.11M	32.83M	23.31M
EBITDA	20.59M	17.48M	10.86M	596.00K	4.08M	-2.62M
Net Income	8.71M	7.00M	13.53M	616.00K	655.00K	-6.79M
Balance Sheet
Total Assets	104.83M	98.53M	92.99M	77.41M	74.38M	51.99M
Cash, Cash Equivalents and Short-Term Investments	38.85M	36.50M	32.03M	31.81M	34.26M	12.96M
Total Debt	2.93M	2.00M	2.57M	1.29M	1.91M	4.61M
Total Liabilities	8.63M	11.90M	6.88M	6.32M	4.95M	8.65M
Stockholders Equity	96.21M	86.63M	86.11M	71.09M	69.43M	43.34M
Cash Flow
Free Cash Flow	21.46M	23.79M	5.92M	3.63M	3.70M	857.00K
Operating Cash Flow	26.43M	23.96M	15.07M	12.46M	8.95M	6.52M
Investing Cash Flow	-9.95M	-9.57M	-9.15M	-8.83M	-5.24M	-5.66M
Financing Cash Flow	-8.57M	-9.92M	-5.70M	-6.08M	17.60M	324.00K

Red Violet Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 49.27
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RDVT, the sentiment is Positive. The current price of 49.27 is above the 20-day moving average (MA) of 44.45, above the 50-day MA of 46.13, and above the 200-day MA of 40.89, indicating a bullish trend. The MACD of 0.63 indicates Negative momentum. The RSI at 67.54 is Neutral, neither overbought nor oversold. The STOCH value of 94.57 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RDVT.

Red Violet Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MITK	78 Outperform	$461.04M	30.65	6.94%	―	6.98%	―
RDVT	76 Outperform	$671.07M	79.74	9.45%	―	22.14%	-45.14%
PRCH	63 Neutral	$1.65B	34.20	75.95%	―	-7.41%	―
Sector *	61 Neutral	$35.62B	7.50	-10.94%	1.87%	8.86%	-10.27%
PUBM	61 Neutral	$380.90M	124.65	-0.65%	―	3.53%	-109.03%
RSKD	50 Neutral	$725.93M	―	-10.16%	―	7.96%	5.67%
LAW	49 Neutral	$317.35M	―	-36.64%	―	4.05%	-100.64%

Red Violet Corporate Events

Red Violet Holds Annual Stockholders Meeting

On June 10, 2025, Red Violet, Inc. held its Annual Meeting of Stockholders, where several key matters were voted upon. The election of directors resulted in the appointment of five individuals to serve until the next annual meeting in 2026. Additionally, the stockholders ratified the appointment of Grant Thornton, LLP as the independent public accounting firm for the year 2025. The amended and restated 2018 Stock Incentive Plan was approved, extending the plan’s term and increasing available shares for issuance. Lastly, the stockholders approved the compensation of the company’s named executive officers for 2024 on an advisory basis.