Actuate Therapeutics, Inc.'s (NASDAQ:ACTU) market cap surged US$24m last week, private equity firms who have a lot riding on the company were rewarded

Key Insights

• Significant control over Actuate Therapeutics by private equity firms implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 55% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

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Every investor in Actuate Therapeutics, Inc. (NASDAQ:ACTU) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 55% to be precise, is private equity firms. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private equity firms were the biggest beneficiaries of last week’s 18% gain.

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

View our latest analysis for Actuate Therapeutics

What Does The Institutional Ownership Tell Us About Actuate Therapeutics?

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.

Actuate Therapeutics already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Actuate Therapeutics, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Actuate Therapeutics. Looking at our data, we can see that the largest shareholder is Bios Equity Partners LP with 43% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 11% and 3.9%, of the shares outstanding, respectively. Additionally, the company's CEO Daniel Schmitt directly holds 2.7% of the total shares outstanding.

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.

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 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 Actuate Therapeutics

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. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Actuate Therapeutics, Inc.. In their own names, insiders own US$6.0m worth of stock in the US$145m company. This shows at least some alignment, but we usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Actuate Therapeutics. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

Private equity firms hold a 55% stake in Actuate Therapeutics. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Actuate Therapeutics has 3 warning signs (and 2 which make us uncomfortable) we think you should know about.

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.