- United States
Retail investors invested in Yatra Online, Inc. (NASDAQ:YTRA) copped the brunt of last week's US$14m market cap decline
- Yatra Online's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
- 53% of the business is held by the top 8 shareholders
- Insider ownership in Yatra Online is 11%
To get a sense of who is truly in control of Yatra Online, Inc. (NASDAQ:YTRA), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 28% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
As a result, retail investors as a group endured the highest losses last week after market cap fell by US$14m.
Let's delve deeper into each type of owner of Yatra Online, beginning with the chart below.
View our latest analysis for Yatra Online
What Does The Institutional Ownership Tell Us About Yatra Online?
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.
As you can see, institutional investors have a fair amount of stake in Yatra Online. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Yatra Online's earnings history below. Of course, the future is what really matters.
It would appear that 28% of Yatra Online shares are controlled by hedge funds. 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. Looking at our data, we can see that the largest shareholder is MAK Capital One, LLC with 20% of shares outstanding. For context, the second largest shareholder holds about 7.9% of the shares outstanding, followed by an ownership of 7.4% by the third-largest shareholder. Furthermore, CEO Dhruv Shringi is the owner of 2.8% of the company's shares.
On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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 is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Yatra Online
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our most recent data indicates that insiders own a reasonable proportion of Yatra Online, Inc.. Insiders own US$13m worth of shares in the US$119m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 28% stake in Yatra Online. 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
We can see that Private Companies own 7.4%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
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.
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.
Yatra Online, Inc. operates as an online travel company in India and internationally.
Excellent balance sheet with high growth potential.