Interlink Electronics, Inc.'s (NASDAQ:LINK) most bullish insider, CEO Steven Bronson must be pleased with the recent 28% gain

Key Insights

• Insiders appear to have a vested interest in Interlink Electronics' growth, as seen by their sizeable ownership
• Steven Bronson owns 68% of the company
• Institutional ownership in Interlink Electronics is 16%

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Every investor in Interlink Electronics, Inc. (NASDAQ:LINK) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 68% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by US$29m last week.

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

Check out our latest analysis for Interlink Electronics

What Does The Institutional Ownership Tell Us About Interlink Electronics?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Interlink Electronics. 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 Interlink Electronics, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Interlink Electronics. Looking at our data, we can see that the largest shareholder is the CEO Steven Bronson with 68% of shares outstanding. This essentially means that they have significant control over the outcome or future of the company, which is why insider ownership is usually looked upon favourably by prospective buyers. In comparison, the second and third largest shareholders hold about 15% and 0.4% of the stock.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Interlink Electronics

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.

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 the majority of Interlink Electronics, Inc.. This means they can collectively make decisions for the company. That means they own US$92m worth of shares in the US$134m company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 15% stake in Interlink Electronics. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Interlink Electronics better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Interlink Electronics .

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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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.