- United States
Puma Biotechnology, Inc.'s (NASDAQ:PBYI) US$24m market value fall may be overlooked by institutional investors after a year of 1.6% returns
- Significantly high institutional ownership implies Puma Biotechnology's stock price is sensitive to their trading actions
- A total of 8 investors have a majority stake in the company with 52% ownership
- Insiders have sold recently
Every investor in Puma Biotechnology, Inc. (NASDAQ:PBYI) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 44% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
No shareholder likes losing money on their investments, especially institutional investors who saw their holdings drop 17% in value last week. However, the 1.6% one-year return to shareholders might have softened the blow. We would assume however, that they would be on the lookout for weakness in the future.
Let's take a closer look to see what the different types of shareholders can tell us about Puma Biotechnology.
View our latest analysis for Puma Biotechnology
What Does The Institutional Ownership Tell Us About Puma Biotechnology?
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 Puma Biotechnology. 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 Puma Biotechnology's earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 15% of Puma Biotechnology. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. The company's CEO Alan Auerbach is the largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.1% and 7.7% of the stock.
We did some more digging and found that 8 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.
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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Puma Biotechnology
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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 information suggests that insiders maintain a significant holding in Puma Biotechnology, Inc.. Insiders own US$17m worth of shares in the US$117m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 26% stake in Puma Biotechnology. 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.
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. Take risks for example - Puma Biotechnology has 5 warning signs (and 3 which shouldn't be ignored) 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.
Puma Biotechnology, Inc., a biopharmaceutical company, focuses on the development and commercialization of products to enhance cancer care in the United States and internationally.
Undervalued with questionable track record.