What's behind the 19% drop in RedCloud Holdings' pre-market trading?

The pre-market trading of RedCloud Holdings (RCT) experienced a significant drop of 19%, with the stock price falling from $4.29 to $2.67. This decline can be attributed to the following factors:

1. **Overvaluation Concerns**: RedCloud Holdings had experienced a significant surge of 43% in its stock price, which could have led to overvaluation concerns among investors. Such a substantial increase can sometimes trigger a pullback as investors seek to profit from the previous gains.
2. **Financial Health Issues**: The company's financial health could be under scrutiny, leading to a loss of investor confidence. For instance, the firm might be facing cash flow problems, high debt levels, or profitability concerns, which could prompt investors to sell off their positions.