Evolv Technologies (NASDAQ: EVLV) announced its quarterly earnings on October 12, 2023, reporting earnings per share (EPS) of ($0.01). This figure exceeded analysts’ expectations, which had estimated an EPS of ($0.07), thereby surpassing the consensus by $0.06. The company’s revenue for the quarter reached $42.85 million, significantly higher than the anticipated $33.73 million.
Despite these positive earnings, Evolv Technologies faced challenges, posting a negative net margin of 43.76% and a return on equity of –54.09%. The company has also updated its guidance for the fiscal year 2025, indicating further adjustments in its financial outlook.
Stock Performance and Market Activity
Following the earnings report, Evolv Technologies saw its stock price decrease by $0.58, bringing it down to $6.00 during midday trading on October 13, 2023. The trading volume was notably high, with 7,535,532 shares changing hands, compared to an average volume of 2,377,491. Over the past year, the stock has fluctuated between a low of $2.49 and a high of $8.91, with a current market capitalization of $1.03 billion.
Analyst ratings for Evolv Technologies are mixed, with several brokerages adjusting their price targets. Lake Street Capital raised its target from $9.00 to $10.00 while maintaining a “buy” rating. In contrast, Weiss Ratings assigned a “sell (d-)” rating on October 8, 2023. Other firms like Cantor Fitzgerald and Zacks Research have also provided varying assessments, with Cantor increasing its target to $9.00 and Zacks upgrading the stock from “strong sell” to “hold.”
Insider Trading and Institutional Ownership
In related developments, insider trading activity showed that Director Michael Ellenbogen sold 80,745 shares on October 15, 2023, at an average price of $8.26, totaling around $666,953.70. This transaction reduced his holdings to 2,083,961 shares, valued at approximately $17.21 million. Additionally, significant shareholder Gates Frontier, LLC sold 776,236 shares on September 11, 2023, realizing over $6.36 million from the sale.
Over the past quarter, insiders sold a total of 1,911,445 shares valued at $15.56 million. Corporate insiders now own 11.30% of Evolv Technologies.
Institutional interest remains strong, with several firms increasing their stakes in the company. CW Advisors LLC raised its position by 19.0% in the second quarter, while Victory Capital Management Inc. boosted its holdings by 16.5% during the third quarter. As of now, institutional investors collectively own 66.65% of Evolv Technologies’ stock.
Established in the United States, Evolv Technologies specializes in artificial intelligence-based security solutions. Its flagship products include Evolv Express, a touchless security screening system designed to detect various threats, and Evolv Insights, which offers data analytics related to visitor flow and system performance.
The recent earnings report and subsequent market activity reflect both the challenges and opportunities faced by Evolv Technologies as it navigates a competitive landscape in the security technology sector.
