Retail investors among GlycoMimetics, Inc.'s (NASDAQ:GLYC) largest shareholders, saw gain in holdings value after stock jumped 28% last week

Key Insights

• Significant control over GlycoMimetics by retail investors implies that the general public has more power to influence management and governance-related decisions
• A total of 9 investors have a majority stake in the company with 50% ownership
• Institutional ownership in GlycoMimetics is 19%

Every investor in GlycoMimetics, Inc. (NASDAQ:GLYC) should be aware of the most powerful shareholder groups. With 43% stake, retail investors 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.

Clearly, retail investors benefitted the most after the company's market cap rose by US$36m last week.

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

View our latest analysis for GlycoMimetics

What Does The Institutional Ownership Tell Us About GlycoMimetics?

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.

As you can see, institutional investors have a fair amount of stake in GlycoMimetics. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see GlycoMimetics' historic earnings and revenue below, but keep in mind there's always more to the story.

It would appear that 15% of GlycoMimetics shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. BVF Partners L.P. is currently the largest shareholder, with 15% of shares outstanding. With 13% and 7.4% of the shares outstanding respectively, Artal Group S.A. and New Enterprise Associates, Inc. are the second and third largest shareholders.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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

Insider Ownership Of GlycoMimetics

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.

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.

Our most recent data indicates that insiders own some shares in GlycoMimetics, Inc.. It has a market capitalization of just US$164m, and insiders have US$4.9m worth of shares, in their own names. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

With a 43% ownership, the general public, mostly comprising of individual investors, have some degree of sway over GlycoMimetics. 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 Equity Ownership

With an ownership of 21%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand GlycoMimetics better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for GlycoMimetics you should be aware of, and 1 of them is a bit unpleasant.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.