Recent 7.9% pullback would hurt Nexters Inc. (NASDAQ:GDEV) insiders

By
Simply Wall St
Published
February 23, 2022
NasdaqGM:GDEV
Source: Shutterstock

To get a sense of who is truly in control of Nexters Inc. (NASDAQ:GDEV), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 48% 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.

As a result, insiders as a group endured the highest losses after market cap fell by US$122m.

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

Check out our latest analysis for Nexters

ownership-breakdown
NasdaqGM:GDEV Ownership Breakdown February 23rd 2022

What Does The Lack Of Institutional Ownership Tell Us About Nexters?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Nexters might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growth
NasdaqGM:GDEV Earnings and Revenue Growth February 23rd 2022

Hedge funds don't have many shares in Nexters. Looking at our data, we can see that the largest shareholder is Everix Investments Limited with 38% of shares outstanding. The second and third largest shareholders are Boris Gertsovskiy and Andrey Fadeev, with an equal amount of shares to their name at 20%. Interestingly, the bottom two of the top three shareholders also hold the title of Top Key Executive and Member of the Board of Directors, respectively, suggesting that these insiders have a personal stake in the company.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Nexters

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

It seems insiders own a significant proportion of Nexters Inc.. Insiders own US$682m worth of shares in the US$1.4b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 14% stake in Nexters. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 38%, of the Nexters stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Nexters you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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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