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Red Cat Holdings (RCAT) stock pushed aggressively to the upside hitting an all-time high of about $18 after the drone company announced a strategic alliance with Allen Control Systems.
Despite this explosive rally, RCAT’s relative strength index (140-day) sits under 63, indicating momentum from its recent defense contracts and strong preliminary Q4 results could drive its stock price higher.
Versus the start of this year, Red Cat shares were seen trading nearly 100% up on March 6.
Does Allen Control Deal Warrant Buying RCAT Stock?
RCAT’s team up with Allen Control Systems integrates artificial intelligence (AI) enabled Bullfrog autonomous weapon stations into its platforms.
For investors, the announcement is positive as it signals Red Cat’s evolution from a “drone-only” company into a multi-domain defense provider (covering air, land, and maritime domains).
Over time, this market expansion may lead to stickier, long-term service and maintenance contracts compared to one-off hardware sales.
Even from a technical perspective, RCAT stock is worth owning given its trading “well above” all of its major moving averages (MAs), indicating a strong uptrend that’s unlikely to subside without a meaningfully negative catalyst.
How High Could Red Cat Shares Fly in 2026?
Despite a sharp rally in 2026, financial services firm Ladenburg Thalmann believes Red Cat shares could push significantly up from here through the remainder of 2026.
In a recent research note, its analyst Michael Legg raised the price target on RCAT to $20, signaling potential upside of more than 10% from its all-time high on Friday.
Legg cited the company’s significant progress in the unmanned aerial systems (UAS) market and its recent strategic expansion into multi-domain defense for his bullish view.
What’s also worth mentioning is that Red Cat Holdings has a history of closing April with a more than 7% gain, a seasonal pattern that makes it even more attractive to own at current levels.
What’s the Consensus Rating on Red Cat Holdings?
Other Wall Street analysts agree with Michael Legg on Red Cat Holdings as well.
The consensus rating on RCAT shares sits at “Moderate Buy” currently with the mean target of about $19.33 indicating potential up some 8% from their recent high.
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