Red Cat Holdings Inc. (RCAT) stock plummeted as much as 9.72% intraday on Thursday, following an announcement from Kerrisdale Capital that they have taken a short position in the company.

Kerrisdale Capital, a well-known activist short-selling firm, revealed that they are betting against Red Cat Holdings, citing concerns about the company's prospects. Short sellers profit from declines in a stock's price by borrowing shares and selling them, with the intention of buying them back at a lower price to return to the lender.

The news of Kerrisdale's short position has weighed heavily on Red Cat Holdings' shares, highlighting investor skepticism surrounding the company's business model and future performance. While the specific reasons behind Kerrisdale's bet against the stock were not immediately disclosed, the move has sparked concerns among traders and investors regarding potential challenges or risks facing Red Cat Holdings.