Daniel MacLachlan, the Chief Financial Officer of Red Violet, Inc. (NASDAQ:RDVT), recently sold 10,000 shares of the company's common stock. The shares were sold on November 25 at a price of $37.25 each, totaling $372,500. Following this transaction, MacLachlan retains ownership of 399,584 shares directly and an additional 466 shares held indirectly through an IRA. The transactions also include various restricted stock units (RSUs) that are set to vest in the coming years, subject to specific conditions.
In other recent news, Red Violet has reported a record-breaking third quarter for the fiscal year 2024. The company's revenue increased by 20% year-over-year, reaching $19.1 million, and adjusted EBITDA rose by 25% to $6.7 million. These results are attributed to Red Violet's strategic focus on customer acquisition and expansion, especially in investigative services, emerging markets, financial risk, and collections verticals.
The company's FOREWARN product is experiencing significant growth, now serving over 500 Realtor Associations, with plans for further expansion in the U.S. real estate market and other industries. The IDI segment of Red Violet added 266 new customers, contributing to the company's overall growth.
Executives at Red Violet have expressed confidence in the company's strategy and outlook, anticipating a record 2024 and sustained growth into 2025. This optimism is backed by the company's strong financial position, with cash and cash equivalents increasing to $35.7 million as of September 30, 2024. These are among the recent developments in the company's performance and strategy.
InvestingPro Insights
The recent stock sale by Red Violet's CFO Daniel MacLachlan comes at a time when the company's stock is showing strong momentum. According to InvestingPro data, Red Violet has experienced significant returns over multiple timeframes, with a 35.74% price increase in the last month and an impressive 82.24% return over the past year. The stock is currently trading near its 52-week high, with the price at 98.75% of its peak.
These performance metrics align with two key InvestingPro Tips: the company has shown a "Strong return over the last month" and a "High return over the last year." This positive price action may have influenced MacLachlan's decision to sell a portion of his holdings.
However, investors should note that Red Violet is trading at elevated valuation multiples. The company's P/E ratio stands at 106.52, which is considered high by most standards. This is reflected in another InvestingPro Tip, which states that the company is "Trading at a high earnings multiple." This valuation could suggest that the stock may be priced for perfection, potentially limiting future upside.
On the financial front, Red Violet boasts impressive gross profit margins, with the latest data showing a gross profit margin of 80.39% for the last twelve months as of Q3 2024. This strength is highlighted by an InvestingPro Tip indicating "Impressive gross profit margins," which could be a positive factor for long-term investors.
For those interested in a more comprehensive analysis, InvestingPro offers 18 additional tips for Red Violet, providing a deeper understanding of the company's financial health and market position.
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