Despite recent sales, Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX) insiders remain the largest stockholders with 49% ownership

Key Insights

• Significant insider control over Amneal Pharmaceuticals implies vested interests in company growth
• 52% of the business is held by the top 6 shareholders
• Recent sales by insiders

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If you want to know who really controls Amneal Pharmaceuticals, Inc. (NASDAQ:AMRX), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Insiders are at the top of the company's shareholdings despite selling some shares recently. As a result, they were also the biggest winners as market cap hit US$2.3b last week.

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

Check out our latest analysis for Amneal Pharmaceuticals

What Does The Institutional Ownership Tell Us About Amneal Pharmaceuticals?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Amneal Pharmaceuticals 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 Amneal Pharmaceuticals' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Amneal Pharmaceuticals. Tushar Patel is currently the largest shareholder, with 16% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.6% and 8.2%, of the shares outstanding, respectively. Chintu Patel, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. Additionally, the company's CEO Chirag Patel directly holds 7.1% of the total shares outstanding.

We did some more digging and found that 6 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Amneal Pharmaceuticals

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.

Our most recent data indicates that insiders own a reasonable proportion of Amneal Pharmaceuticals, Inc.. It is very interesting to see that insiders have a meaningful US$1.1b stake in this US$2.3b business. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

With a 10% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Amneal Pharmaceuticals. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Amneal Pharmaceuticals (of which 1 is a bit concerning!) 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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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.