PolyPeptide Group AG's (VTX:PPGN) market cap dropped CHF109m last week; individual investors who hold 56% were hit as were institutions

Key Insights

• Significant control over PolyPeptide Group by private companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is Draupnir Holding B.V. with a 56% stake
• 20% of PolyPeptide Group is held by Institutions

To get a sense of who is truly in control of PolyPeptide Group AG (VTX:PPGN), it is important to understand the ownership structure of the business. We can see that private companies own the lion's share in the company with 56% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 17% decrease in the stock price last week, private companies suffered the most losses, but institutions who own 20% stock also took a hit.

Let's delve deeper into each type of owner of PolyPeptide Group, beginning with the chart below.

Check out our latest analysis for PolyPeptide Group

What Does The Institutional Ownership Tell Us About PolyPeptide Group?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that PolyPeptide Group does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of PolyPeptide Group, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in PolyPeptide Group. The company's largest shareholder is Draupnir Holding B.V., with ownership of 56%. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Meanwhile, the second and third largest shareholders, hold 5.2% and 3.3%, of the shares outstanding, respectively. Additionally, the company's CEO Juan Gonzalez directly holds 0.7% of the total shares outstanding.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of PolyPeptide Group

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own some shares in PolyPeptide Group AG. As individuals, the insiders collectively own CHF23m worth of the CHF524m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 20% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 56%, of the PolyPeptide Group stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 2 warning signs for PolyPeptide Group you should be aware of, and 1 of them is a bit concerning.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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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.