Lucid Group, Inc.'s (NASDAQ:LCID) market cap dropped US$2.1b last week; Sovereign wealth funds bore the brunt

Every investor in Lucid Group, Inc. (NASDAQ:LCID) should be aware of the most powerful shareholder groups. With 60% stake, sovereign wealth funds possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 11% decline in share price, sovereign wealth funds suffered the most losses.

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

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What Does The Institutional Ownership Tell Us About Lucid 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 Lucid Group 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. 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 Lucid Group, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Lucid Group. Looking at our data, we can see that the largest shareholder is The Public Investment Fund of The Kingdom of Saudi Arabia with 60% of shares outstanding. This implies that they have majority interest control of the future of the company. The second and third largest shareholders are Michael Klein and The Vanguard Group, Inc., with an equal amount of shares to their name at 3.1%. Additionally, the company's CEO Peter Rawlinson directly holds 0.5% of the total shares outstanding.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Lucid 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Shareholders would probably be interested to learn that insiders own shares in Lucid Group, Inc.. The insiders have a meaningful stake worth US$700m. we sometimes take an interest in whether they have been buying or selling.

General Public Ownership

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Lucid Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Lucid Group better, we need to consider many other factors. Be aware that Lucid Group is showing 2 warning signs in our investment analysis , you should know about...

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.