After buying recently, BioArctic AB (publ) (STO:BIOA B) insiders must be dismayed to see the company's market cap drop to kr20b

Key Insights

• Insiders appear to have a vested interest in BioArctic's growth, as seen by their sizeable ownership
• A total of 2 investors have a majority stake in the company with 55% ownership
• Insiders have been buying lately

Every investor in BioArctic AB (publ) (STO:BIOA B) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 57% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Notably, insiders have bought shares recently. Their expectations, however, were not satisfied, as the market cap dropped to kr20b over the past week.

Let's take a closer look to see what the different types of shareholders can tell us about BioArctic.

See our latest analysis for BioArctic

What Does The Institutional Ownership Tell Us About BioArctic?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

BioArctic already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see BioArctic's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in BioArctic. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In BioArctic's case, its Top Key Executive, Lars Lannfelt, is the largest shareholder, holding 33% of shares outstanding. For context, the second largest shareholder holds about 22% of the shares outstanding, followed by an ownership of 4.2% by the third-largest shareholder. Interestingly, the second-largest shareholder, Pär Gellerfors is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of BioArctic

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 the majority of BioArctic AB (publ). This means they can collectively make decisions for the company. Insiders own kr12b worth of shares in the kr20b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public-- including retail investors -- own 13% stake in the company, and hence can't easily be ignored. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.