Painful week for individual investors invested in Hansa Biopharma AB (publ) (STO:HNSA) after 10% drop, institutions also suffered losses

Key Insights

• Significant control over Hansa Biopharma by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 12 shareholders own 51% of the company
• Institutions own 28% of Hansa Biopharma

To get a sense of who is truly in control of Hansa Biopharma AB (publ) (STO:HNSA), it is important to understand the ownership structure of the business. With 43% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions who own 28% came under pressure after market cap dropped to kr1.5b last week,individual investors took the most losses.

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

View our latest analysis for Hansa Biopharma

What Does The Institutional Ownership Tell Us About Hansa Biopharma?

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.

We can see that Hansa Biopharma does have institutional investors; and they hold a good portion of the company's stock. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Hansa Biopharma's earnings history below. Of course, the future is what really matters.

It looks like hedge funds own 18% of Hansa Biopharma shares. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. Redmile Group, LLC is currently the largest shareholder, with 18% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.1% and 4.0% of the stock.

A closer look at our ownership figures suggests that the top 12 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Hansa Biopharma

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.

We can see that insiders own shares in Hansa Biopharma AB (publ). As individuals, the insiders collectively own kr133m worth of the kr1.5b company. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 43% 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:

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. Be aware that Hansa Biopharma is showing 4 warning signs in our investment analysis , and 2 of those are 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.