Red Violet, Inc. (RDVT) Stock Analysis

Why this analysis is different

• A sector-relative MoonshotScore — five pillars (business quality, financial safety, valuation, growth durability, momentum) re-ranked nightly against the full universe of US-listed common stocks.
• An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
• Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.

Red Violet, Inc. (RDVT) Technology Profile & Competitive Position

Red Violet, Inc. delivers identity intelligence solutions through proprietary technologies, serving sectors like finance, insurance, and law enforcement. Its idiCORE and FOREWARN platforms provide risk mitigation and due diligence capabilities, positioning it as a key player in the application software space with a focus on data analytics.

What Is the Investment Thesis for RDVT?

Red Violet, Inc. presents an investment opportunity within the identity intelligence sector, driven by its proprietary technologies and analytical capabilities. The company's high gross margin of 84.2% indicates strong pricing power and efficient operations. With a P/E ratio of 62.97, the company is trading at a premium, reflecting investor expectations of future growth. Key growth catalysts include expanding its market reach within the financial services and law enforcement sectors. Potential risks include increasing competition and the need to continually innovate to maintain its technological edge. The company's beta of 1.81 suggests higher volatility compared to the market.

Based on FMP financials and quantitative analysis

RDVT Key Highlights

Market Cap of $1.03B reflects its position as a mid-sized player in the application software market.

• P/E Ratio of 62.97 indicates a premium valuation, suggesting high growth expectations from investors.
• Profit Margin of 15.0% demonstrates effective cost management and profitability.
• Gross Margin of 84.2% showcases strong pricing power and efficient service delivery.
• Beta of 1.81 suggests higher volatility compared to the market, potentially offering higher returns but also increased risk.

Who Are RDVT's Competitors?

RDVT is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are RDVT's Key Strengths?

Proprietary technology and analytical capabilities

• Diverse customer base across multiple sectors
• High gross margin indicating strong pricing power
• Established presence in the identity intelligence market

What Are RDVT's Weaknesses?

Relatively small size compared to larger competitors

• Limited geographic presence, primarily focused on the United States
• Dependence on key distributors and resellers
• High beta indicating higher volatility

What Could Drive RDVT Stock Higher?

Potential new partnerships with law enforcement agencies to expand market reach.

• Continued expansion of the FOREWARN platform into new sectors.
• Increasing demand for identity verification solutions in the financial services sector.

What Are the Key Risks for RDVT?

Rich valuation — a P/E of 62.97 runs well above the Technology sector’s ~32.70x, leaving little room for a miss.

• Insider selling — insiders were net sellers of roughly $2.5M recently.
• Increasing competition in the identity intelligence market.
• Rapid technological advancements that could render existing solutions obsolete.
• Changes in regulations and compliance requirements impacting the industry.

What Are the Growth Opportunities for RDVT?

• Expansion within the financial services sector: The increasing need for fraud detection and regulatory compliance in the financial services industry presents a significant growth opportunity for Red Violet. By tailoring its idiCORE and FOREWARN solutions to meet the specific needs of financial institutions, Red Violet can capture a larger share of this market. The financial services sector is projected to spend billions on fraud prevention technologies, offering a substantial revenue stream for Red Violet over the next 3-5 years.
• Penetration of the healthcare market: The healthcare industry is facing growing challenges related to identity theft and fraud, creating a demand for identity intelligence solutions. Red Violet can leverage its expertise to develop customized solutions for healthcare providers and insurance companies. This includes verifying patient identities, preventing fraudulent claims, and ensuring regulatory compliance. The healthcare identity management market is expected to grow significantly, providing a long-term growth opportunity for Red Violet.
• Strategic partnerships with law enforcement agencies: Collaborating with law enforcement agencies to provide advanced investigative tools can drive significant growth for Red Violet. By offering solutions that enhance law enforcement's ability to identify and track criminals, Red Violet can establish itself as a key partner in public safety. Government contracts and partnerships can provide a stable and recurring revenue stream, contributing to the company's long-term growth.
• Geographic expansion into international markets: While currently focused on the United States, Red Violet has the potential to expand its operations into international markets. The demand for identity intelligence solutions is growing globally, particularly in regions with high rates of fraud and cybercrime. By adapting its solutions to meet the specific needs of international markets, Red Violet can tap into new revenue streams and diversify its customer base. This expansion could occur over the next 5-10 years.
• Development of new product offerings: Investing in research and development to create new and innovative identity intelligence solutions can drive organic growth for Red Violet. This includes exploring emerging technologies such as artificial intelligence and machine learning to enhance its existing products and develop new offerings. By staying ahead of the curve in terms of technology, Red Violet can maintain its competitive advantage and attract new customers. New products could be launched within the next 2-3 years.

What Are RDVT's Competitive Advantages?

• Proprietary Technologies: Red Violet's idiCORE and FOREWARN solutions are based on proprietary technologies, creating a barrier to entry for competitors.
• Analytical Capabilities: The company's strong analytical capabilities enable it to deliver valuable insights and intelligence to its customers.
• Established Customer Base: Red Violet has built a diverse and established customer base across various sectors, providing a stable revenue stream.
• Multi-Channel Marketing Approach: The company's multi-channel marketing approach allows it to reach a wide range of potential customers.

What Does RDVT Do?

Red Violet, Inc., incorporated in 2017 and headquartered in Boca Raton, Florida, is a software and services company focused on providing identity intelligence solutions. The company's core offerings include idiCORE, an investigative solution designed to address organizational challenges such as due diligence, risk mitigation, identity authentication, and regulatory compliance. Additionally, Red Violet offers FOREWARN, an app-based solution that delivers instant knowledge to professionals before face-to-face interactions with consumers, aiding in risk identification and mitigation. Red Violet serves a diverse clientele across various sectors, including financial services, insurance, healthcare, retail, and telecommunications. It also caters to law enforcement and government agencies, as well as collections, corporate security, and investigative firms. The company's solutions are utilized for purposes such as fraud detection and prevention, regulatory compliance, and customer acquisition. The company markets its products and services through a multi-channel approach, leveraging value-added distributors, resellers, and strategic partners. Red Violet also engages in trade shows, seminars, advertising, public relations, and the distribution of sales literature. Ongoing communication with prospective customers, distributors, resellers, strategic partners, and its installed base of current customers is maintained, alongside direct sales efforts.

What Products and Services Does RDVT Offer?

• Provides identity intelligence solutions to various sectors.
• Offers idiCORE for investigative purposes, addressing due diligence and risk mitigation.
• Provides FOREWARN, an app-based solution for instant knowledge before face-to-face interactions.
• Serves financial services, insurance, healthcare, retail, and telecommunication companies.
• Caters to law enforcement and government agencies.
• Aids in fraud detection and prevention, regulatory compliance, and customer acquisition.
• Utilizes proprietary technologies and analytical capabilities.

How Does RDVT Make Money?

• Generates revenue through the sale of its idiCORE and FOREWARN solutions.
• Employs a multi-channel marketing approach, including distributors, resellers, and strategic partners.
• Utilizes direct sales and ongoing communication with customers to drive revenue.

What Industry Does RDVT Operate In?

Red Violet operates within the application software industry, which is experiencing growth driven by the increasing need for data analytics and identity verification solutions. The market is competitive, with companies like YMM: Full Truck Alliance Co. Ltd. also vying for market share. Red Violet differentiates itself through its focus on identity intelligence and its proprietary technologies like idiCORE and FOREWARN. The demand for risk mitigation and fraud prevention solutions is expected to continue to drive growth in this sector.

Who Are RDVT's Key Customers?

• Financial services companies seeking fraud detection and regulatory compliance.
• Insurance companies requiring risk mitigation and identity verification.
• Law enforcement and government agencies needing investigative tools.
• Healthcare providers aiming to prevent identity theft and fraudulent claims.
• Retail and telecommunication companies focused on customer acquisition and risk management.

Company Profile

Red Violet, Inc. operates in the Software - Application industry within the Technology sector. It is headquartered in Boca Raton, US. The company is led by CEO Derek Dubner. RDVT has traded publicly since 2018.

Return on equity for Red Violet, Inc. stands at 14.0%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 12.5%, showing how much profit it generates from its asset base. RDVT trades at a trailing price-to-earnings ratio of 62.97, above the Technology sector average of ~32.70x. Its free cash flow yield is 3.5%, a gauge of the cash the business throws off relative to its market value. A current ratio of 11.22 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 1.8%, the inverse of the P/E and a quick read on earnings relative to price.

RDVT Valuation & Market Position

With a $1.03B market cap, Red Violet, Inc. sits in the small-cap segment of the market. Analyst price targets span from $73.00 to $90.00, with a consensus of $81.50. At the current price of $73.05, that implies approximately 12% upside potential. Relative to its peer group, RDVT's quantitative score of 93/100 is above the peer average of 81/100.

Quarterly Financial Performance: Red Violet, Inc.

Revenue for Red Violet, Inc. came in at $26.7M during Q2 FY2026, a 3.4% improvement versus the preceding quarter. The company recorded net income of $5.0M, with diluted EPS of $0.35. Revenue has increased across the last three reported quarters, suggesting sustained momentum for this small-cap Technology company. Across the four most recent quarters, RDVT averaged $0.29 in diluted EPS.

Red Violet, Inc.'s Piotroski F-Score is 7/9, a 9-point checklist of profitability, leverage and efficiency — signaling solid underlying fundamentals. Its Altman Z-Score of 72.97 places it in the safe zone, indicating low near-term bankruptcy risk.

Red Violet, Inc. has beaten Wall Street's EPS estimate in 5 of its last 8 reported quarters — more hits than misses. Reported results have landed about 24.4% above estimates on average.

Over the past six months, Red Violet, Inc. insiders filed 13 SEC Form 4 transactions — 8 sales and 5 purchases. On net that is roughly 35K shares disposed (about $2.5M), a signal worth weighing alongside the fundamentals.

RDVT Financials

RDVT Latest News

RDVT Analyst Consensus

RDVT MoonshotScore

Common Questions About RDVT (Technology)

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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