Red Violet (RDVT)
NASDAQ:RDVT
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Red Violet
(NASDAQ:RDVT)
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Rating:80Outperform
Price Target:
$57.00
▲(44.60% Upside)
Action:Reiterated
Date:05/09/26
The score is driven primarily by strong financial quality (high margins, low leverage, solid free cash flow) and a very constructive earnings update with record profitability and cash generation. Offsetting factors are overbought technical conditions and a higher valuation (P/E ~28) that leaves less room for execution missteps, especially given expense growth and limited formal guidance.
Positive Factors
High Margins & Profitability
Sustained, very high gross margins and a materially expanded adjusted EBITDA margin indicate durable unit economics and pricing power in identity data services. High margins support reinvestment in product, margin resiliency through cycles, and long-term free cash flow generation to fund growth or returns.
Negative Factors
Modest TTM Revenue Growth
Trailing revenue growth has been modest versus peers despite recent quarter strength, implying that scaling the business to higher growth rates may require sustained investment or new product expansion. Slow top-line growth could limit long-run operating leverage benefits.
Read all positive and negative factors
Positive Factors
Negative Factors
High Margins & Profitability
Sustained, very high gross margins and a materially expanded adjusted EBITDA margin indicate durable unit economics and pricing power in identity data services. High margins support reinvestment in product, margin resiliency through cycles, and long-term free cash flow generation to fund growth or returns.
Read all positive factors
Red Violet (RDVT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$697.40M
Dividend YieldN/A
Average Volume (3M)124.66K
Price to Earnings (P/E)28.0
Beta (1Y)1.19
Revenue Growth18.07%
EPS Growth60.39%
CountryUS
Employees215
SectorTechnology
Sector Strength88
IndustrySoftware - Application
Share Statistics
EPS (TTM)1.00
Shares Outstanding14,108,921
10 Day Avg. Volume178,818
30 Day Avg. Volume124,662
Financial Highlights & Ratios
PEG Ratio0.72
Price to Book (P/B)7.92
Price to Sales (P/S)8.86
P/FCF Ratio27.77
Enterprise Value/Market Cap0.94
Enterprise Value/Revenue7.00
Enterprise Value/Gross Profit8.31
Enterprise Value/Ebitda28.13
Forecast
1Y Price Target
$63.50Price Target Upside61.09% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)1.35
Revenue Forecast (FY)$102.91M
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 var...
How the Company Makes Money
Red Violet makes money by selling access to its identity intelligence and analytics capabilities as recurring, usage-based, or subscription-like services to business and government clients. Revenue is primarily generated from fees tied to (a) cust...
Red Violet Earnings Call Summary
Earnings Call Date:May 06, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Positive
The call conveyed a strongly positive operational and financial performance: record revenue, record margins, record adjusted EBITDA and EPS, meaningful customer and user growth, and substantial cash generation. Management emphasized AI-driven acceleration, disciplined capital allocation, and a clear multi-year operating thesis while continuing to invest in go-to-market, product, and data. Headwinds were limited to elevated operating investments (notably a 28% increase in G&A), modest weakness in the non-FOREWARN real estate vertical, a 1-point dip in gross retention, and the absence of a timeline for long-term margin maturity. Overall, the positives (record results, margin expansion, customer/user growth, and cash flow) materially outweigh the limited challenges and uncertainties.Positive Updates
Record Revenue and Run Rate Milestone
Revenue reached a record $25.8M in Q1, up 17% year-over-year and crossing a $100M+ annualized revenue run rate; management noted underlying growth >20% when normalizing for $1.2M of one-time revenue in the prior-year quarter (analyst apples-to-apples estimate ~24%).
Negative Updates
Rising Operating Expenses (G&A and S&M)
General and administrative expenses increased 28% to $7.9M (driven by higher personnel costs and acquisition-related activity); sales and marketing rose 8% to $5.9M—indicating higher near-term investment and pressure on operating expense growth.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Revenue and Run Rate Milestone
Revenue reached a record $25.8M in Q1, up 17% year-over-year and crossing a $100M+ annualized revenue run rate; management noted underlying growth >20% when normalizing for $1.2M of one-time revenue in the prior-year quarter (analyst apples-to-apples estimate ~24%).
Read all positive updates
Company Guidance
Management said it would not provide formal guidance or a timeline, but reiterated model targets and near-term expectations: Q1 revenue was $25.8M (up 17% YoY; >$100M annual run rate), adjusted gross profit $22.0M (adjusted gross margin 85%, +2 pts), adjusted EBITDA $10.7M (adj. EBITDA margin 41%, +3 pts), adjusted net income $6.6M and adjusted EPS $0.46, operating cash flow $6.6M (+32%), free cash flow $3.1M (+24%), cash $43.5M, 73,250 shares repurchased at an average $41.90 with $15.6M remaining; customer metrics included 400 new billable IDI customers (total 10,422), FOREWARN >417,000 users and >640 realtor associations, contractual revenue 75% and gross revenue retention 95%; operating costs included cost of revenue ex‑D&A $3.8M (+4%), S&M $5.9M (+8%), G&A $7.9M (+28%), and D&A $2.8M (+10%). Looking ahead, management expects near‑term adjusted EBITDA margins to trend in the mid‑to‑high‑30% range as they invest, and reiterated that at maturity the model could exceed 90% adjusted gross margin and approach ~65% adjusted EBITDA margin, but they declined to pin a date on that outcome.Red Violet Financial Statement Overview
Summary
Income Statement
83
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
87
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 94.08M | 90.25M | 75.19M | 60.20M | 53.32M | 44.02M |
| Gross Profit | 79.25M | 75.58M | 61.19M | 47.13M | 41.11M | 32.83M |
| EBITDA | 23.41M | 23.81M | 17.48M | 10.86M | 7.04M | 4.08M |
| Net Income | 14.10M | 13.15M | 7.00M | 13.53M | 616.00K | 655.00K |
Balance Sheet | ||||||
| Total Assets | 112.63M | 112.01M | 98.53M | 92.99M | 77.41M | 74.38M |
| Cash, Cash Equivalents and Short-Term Investments | 43.45M | 43.56M | 36.50M | 32.03M | 31.81M | 34.26M |
| Total Debt | 2.72M | 2.79M | 2.00M | 2.57M | 1.29M | 1.91M |
| Total Liabilities | 8.11M | 11.09M | 11.90M | 6.88M | 6.32M | 4.95M |
| Stockholders Equity | 104.53M | 100.93M | 86.63M | 86.11M | 71.09M | 69.43M |
Cash Flow | ||||||
| Free Cash Flow | 27.66M | 28.79M | 23.79M | 5.92M | 3.63M | 3.70M |
| Operating Cash Flow | 30.93M | 29.35M | 23.96M | 15.07M | 12.46M | 8.95M |
| Investing Cash Flow | -12.14M | -11.16M | -9.57M | -9.15M | -8.83M | -5.24M |
| Financing Cash Flow | -9.94M | -11.14M | -9.92M | -5.70M | -6.08M | 17.60M |
Red Violet Technical Analysis
Positive
39.42
Price Trends
40.15
Positive
43.57
Positive
47.57
Positive
Market Momentum
2.61
Negative
68.54
Neutral
80.62
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 39.42 is below the 20-day moving average (MA) of 43.17, below the 50-day MA of 40.15, and below the 200-day MA of 47.57, indicating a bullish trend. The MACD of 2.61 indicates Negative momentum. The RSI at 68.54 is Neutral, neither overbought nor oversold. The STOCH value of 80.62 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RDVT.
Red Violet Risk Analysis
Red Violet disclosed 32 risk factors in its most recent earnings report. Red Violet reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Red Violet Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $697.40M | 27.98 | 13.98% | ― | 18.07% | 60.39% | |
69 Neutral | $596.70M | 42.06 | 9.69% | ― | 8.25% | -99.84% | |
69 Neutral | $703.64M | -32.63 | -5.93% | ― | 5.10% | 48.36% | |
62 Neutral | $763.06M | -17.53 | -2.39% | ― | -7.90% | -116.58% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
56 Neutral | $414.77M | 1.90 | -108.85% | ― | -11.42% | -20.07% | |
46 Neutral | $166.14M | -7.75 | 31.73% | ― | 0.57% | 31.68% |
* Technology Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.