Red Violet, Inc. (RDVT) Q2 2025 Earnings Call Transcript

Validea's Small-Cap Growth Investor Model: The model identifies small-cap growth stocks with strong fundamentals and price performance, highlighting recent upgrades for several companies based on their ratings according to Motley Fool's strategy.

Loews Corporation (L): This large-cap growth stock in the insurance industry saw its rating increase from 65% to 72%, indicating improved fundamentals and valuation, though it remains below the strong interest threshold of 80%.

Mercury General Corporation (MCY): A mid-cap value stock in the insurance sector, MCY's rating also rose from 59% to 72%, reflecting better fundamentals and valuation, yet still short of the 80% interest mark.

Red Violet Inc (RDVT): This small-cap growth stock in the software industry improved its rating from 63% to 76%, showing strong fundamentals and valuation, but it has not yet reached the 80% threshold for significant interest.

Zacks Rank Upgrade: Red Violet, Inc. (RDVT) has been upgraded to a Zacks Rank #2 (Buy), indicating a positive outlook on its earnings estimates, which often leads to increased stock prices.

Earnings Estimate Revisions: The Zacks Consensus Estimate for RDVT has risen by 11.8% over the past three months, reflecting improved expectations for the company's earnings potential.

Investment Strategy: The Zacks rating system, which maintains a balanced distribution of buy and sell ratings, suggests that RDVT is among the top 20% of stocks based on earnings estimate revisions, making it a strong candidate for market-beating returns.

Market Trends: The demand for data is driving growth in the semiconductor market, with companies that provide essential hardware for data centers poised to benefit significantly in the future.

Recognition of Red Violet: Red Violet, Inc. has been named to TIME's list of "America's Growth Leaders of 2026," highlighting its growth performance, financial stability, and stock performance among U.S. companies.

CEO's Statement: CEO Derek Dubner emphasized that this recognition reflects the company's innovative technology, strong execution, and commitment to creating long-term value while enhancing safety and reducing business costs.

Ranking Methodology: The ranking was based on three key dimensions: Growth Performance, Financial Stability, and Stock Performance, evaluated over five years using various financial metrics.

About Red Violet: Red Violet specializes in identity intelligence solutions, utilizing proprietary technologies to assist organizations in identity verification, risk mitigation, and fraud prevention, among other applications.

Earnings Conference Call Overview: Red Violet, Inc. held its Q2 2025 earnings conference call on August 6, 2025, featuring key participants including CEO Derek Dubner and CFO Dan MacLachlan, discussing the company's financial results and future outlook.

Forward-Looking Statements Disclaimer: The company cautioned that certain statements made during the call are forward-looking and subject to risks and uncertainties, advising listeners to review SEC filings for more information.

Momentum Investing Overview: Momentum investing involves buying stocks that are trending upwards, with the expectation of selling them at even higher prices. Red Violet, Inc. (RDVT) currently has a strong Momentum Style Score of A and a Zacks Rank of #2 (Buy), indicating its potential for profitable trades based on recent price trends and earnings estimate revisions.

Performance Metrics for RDVT: RDVT's stock has shown significant growth, with a 35.08% increase over the past quarter and a 131.57% rise in the last year, outperforming the S&P 500. Additionally, positive earnings estimate revisions have contributed to its favorable momentum outlook, making it a promising investment choice.