What Type Of Shareholders Make Up Faron Pharmaceuticals Oy's (LON:FARN) Share Registry?

A look at the shareholders of Faron Pharmaceuticals Oy (LON:FARN) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.

With a market capitalization of UK£140m, Faron Pharmaceuticals Oy is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about Faron Pharmaceuticals Oy.

Check out our latest analysis for Faron Pharmaceuticals Oy

What Does The Institutional Ownership Tell Us About Faron Pharmaceuticals Oy?

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.

Faron Pharmaceuticals Oy already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Faron Pharmaceuticals Oy, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Faron Pharmaceuticals Oy. Timo Syrjälä is currently the company's largest shareholder with 14% of shares outstanding. Tom-Erik Lind is the second largest shareholder owning 7.6% of common stock, and A&B (HK) Company Limited holds about 7.3% of the company stock. In addition, we found that Markku Jalkanen, the CEO has 6.8% of the shares allocated to his name

We did some more digging and found that 8 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Faron Pharmaceuticals Oy

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 a reasonable proportion of Faron Pharmaceuticals Oy. It has a market capitalization of just UK£140m, and insiders have UK£51m worth of shares in their own names. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 47% ownership, the general public have some degree of sway over Faron Pharmaceuticals Oy. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 7.3%, of the Faron Pharmaceuticals Oy 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Faron Pharmaceuticals Oy better, we need to consider many other factors. Take risks for example - Faron Pharmaceuticals Oy has 6 warning signs (and 3 which are significant) we think you should know about.

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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