Institutional investors have a lot riding on Kaltura, Inc. (NASDAQ:KLTR) with 33% ownership

Key Insights

• Given the large stake in the stock by institutions, Kaltura's stock price might be vulnerable to their trading decisions
• A total of 7 investors have a majority stake in the company with 54% ownership
• Insider ownership in Kaltura is 13%

To get a sense of who is truly in control of Kaltura, Inc. (NASDAQ:KLTR), it is important to understand the ownership structure of the business. We can see that institutions own the lion's share in the company with 33% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Last week’s 10% gain means that institutional investors were on the positive end of the spectrum even as the company has shown strong longer-term trends. The one-year return on investment is currently 18% and last week's gain would have been more than welcomed.

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

View our latest analysis for Kaltura

What Does The Institutional Ownership Tell Us About Kaltura?

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 Kaltura. 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. 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 Kaltura, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Kaltura. The company's largest shareholder is .406 Ventures, LLC, with ownership of 11%. For context, the second largest shareholder holds about 11% of the shares outstanding, followed by an ownership of 9.7% by the third-largest shareholder. Additionally, the company's CEO Ron Yekutiel directly holds 6.2% of the total shares outstanding.

On further inspection, we found that more than half the company's shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Kaltura

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

It seems insiders own a significant proportion of Kaltura, Inc.. Insiders have a US$46m stake in this US$349m business. 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

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Kaltura. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With an ownership of 33%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Next Steps:

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. Case in point: We've spotted 3 warning signs for Kaltura you should be aware of.

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.