Private equity firms among Jasper Therapeutics, Inc.'s (NASDAQ:JSPR) largest stockholders and were hit after last week's 11% price drop

By
Simply Wall St
Published
January 14, 2022
NasdaqCM:JSPR
Source: Shutterstock

Every investor in Jasper Therapeutics, Inc. (NASDAQ:JSPR) should be aware of the most powerful shareholder groups. We can see that private equity firms own the lion's share in the company with 42% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, private equity firms endured the biggest losses as the stock fell by 11%.

In the chart below, we zoom in on the different ownership groups of Jasper Therapeutics.

Check out our latest analysis for Jasper Therapeutics

ownership-breakdown
NasdaqCM:JSPR Ownership Breakdown January 14th 2022

What Does The Institutional Ownership Tell Us About Jasper Therapeutics?

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.

Jasper Therapeutics already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Jasper Therapeutics, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
NasdaqCM:JSPR Earnings and Revenue Growth January 14th 2022

It looks like hedge funds own 11% of Jasper Therapeutics shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. The company's largest shareholder is Qiming Weichuang Venture Capital Management (Shanghai) Company Limited, with ownership of 15%. With 15% and 12% of the shares outstanding respectively, Abingworth LLP and Roche Holding AG are the second and third largest shareholders.

Our research also brought to light the fact that roughly 54% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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 Jasper 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Jasper Therapeutics, Inc.. In their own names, insiders own US$16m worth of stock in the US$237m company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 13% stake in Jasper Therapeutics. 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 a stake of 42%, private equity firms could influence the Jasper Therapeutics board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Public Company Ownership

Public companies currently own 19% of Jasper Therapeutics stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Jasper Therapeutics (at least 2 which can't be ignored) , and understanding them should be part of your investment process.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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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