Red Violet (RDVT) opened 2026 with Q1 revenue of US$25.8 million and basic EPS of US$0.31, while trailing twelve month revenue sat at US$94.1 million and EPS at US$1.00, setting a clear benchmark for its recent performance. Over the past year, revenue on a trailing basis moved from US$79.7 million to US$94.1 million and EPS advanced from US$0.62 to US$1.00, with net profit margin improving from 10.9% to 15% as earnings grew 62.9%. The result is a quarter that points to firmer profitability and keeps the focus squarely on how durable these margin gains and earnings trends prove to be.

See our full analysis for Red Violet.

With the latest numbers on the table, the next step is to see how this earnings profile lines up with the key Red Violet narratives that investors follow and where those stories might need updating.

Margins Backed By 62.9% Earnings Growth

• On a trailing basis, Red Violet earned US$14.1 million of net income on US$94.1 million of revenue. This lines up with the 15% net profit margin and 62.9% earnings growth over the past year that were highlighted earlier.
• Consensus narrative points to expansion into enterprise and government sectors and strong FOREWARN retention as growth drivers. The current 15% margin and five year annualized earnings growth of 51.1% give bulls concrete profitability figures to compare against future wins in those verticals.
  • Supporters of the bullish view can point to recurring identity analytics demand and high earnings quality as consistent with a US$94.1 million revenue base and 15% margin today.
  • At the same time, any slowdown from the recent 62.9% earnings growth toward the forecast 13.1% per year would be an important test of how durable those enterprise and government opportunities really are.

Premium P/E And DCF Gap

• The stock trades on a trailing P/E of about 49.1x versus roughly 29x for peers and US Software. The DCF fair value of US$34.58 sits below the current share price of US$49.09.
• Bears focus on this valuation stretch, arguing that a rich multiple and a share price above DCF fair value leave less room for disappointment even with healthy growth forecasts.
  • The forecast earnings growth rate of about 13.1% per year is solid in absolute terms, yet it is lower than the company’s 51.1% five year annualized earnings growth, which critics see as a moderation against a high 49.1x P/E.
  • With the stock above the US$34.58 DCF fair value and also above peer and industry P/E levels, skeptics will watch whether revenue growth near 13.5% per year is enough to justify that premium.

On these numbers, many investors will want to stress test their own valuation views against a full breakdown of the company report before deciding how comfortable they are with that premium, especially given the DCF fair value gap and the current 49.1x P/E. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Red Violet.

Quarterly Run Rate Supports Growth Story

• Q1 2026 revenue of US$25.8 million and net income of US$4.4 million compare with trailing twelve month revenue of US$94.1 million and net income of US$14.1 million, so this single quarter already represents more than a quarter of the latest annual run rate.
• Supporters of the bullish narrative point to broad based demand and recurring revenue growth. The step up from US$19.6 million of quarterly revenue in Q4 2024 to US$25.8 million in Q1 2026 is one concrete way to see how that story is tracking.
  • Revenue moved from US$75.2 million on a trailing basis in Q4 2024 to US$94.1 million by Q1 2026, giving bulls a larger revenue base to match against claims of growing enterprise, government and new vertical exposure.
  • With analysts forecasting revenue growth of about 13.5% per year, the current Q1 run rate and trailing twelve month totals are key reference points for anyone judging whether that bullish revenue path is realistic.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Red Violet on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

Overall, does the mix of earnings growth, margins and valuation make you optimistic or cautious about Red Violet at today’s price? Act quickly, review the underlying data in detail and weigh those potential upsides for yourself by checking the 2 key rewards.

Explore Alternatives

Red Violet’s key weak spot is its rich 49.1x P/E and share price above the US$34.58 DCF fair value, which heightens valuation risk.

If that premium worries you, it is worth widening your search to stocks where price and fundamentals sit closer together by checking the 51 high quality undervalued stocks.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.