Could Phivida Holdings Inc.’s (CNSX:VIDA) Investor Composition Influence The Stock Price?

Simply Wall St - finance.yahoo.com Posted 8 months ago
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A look at the shareholders of Phivida Holdings Inc. (CNSX:VIDA) can tell us which group is most powerful. Institutions often own shares in more established companies, while it’s not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.’

Phivida Holdings is not a large company by global standards. It has a market capitalization of CA$36m, which means it wouldn’t have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it’s seems that institutional investors have not yet purchased shares. We can zoom in on the different ownership groups, to learn more about VIDA.

Check out our latest analysis for Phivida Holdings

CNSX:VIDA Ownership Summary, March 14th 2019
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What Does The Lack Of Institutional Ownership Tell Us About Phivida Holdings?

We don’t tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it’s not particularly common.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don’t attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. Alternatively, there might be something about the company that has kept institutional investors away. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Phivida Holdings, for yourself, below.

CNSX:VIDA Income Statement, March 14th 2019
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Phivida Holdings is not owned by hedge funds. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Phivida Holdings

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

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Our most recent data indicates that insiders own a reasonable proportion of Phivida Holdings Inc.. Insiders own CA$5.5m worth of shares in the CA$36m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public — mostly retail investors — own 84% of Phivida Holdings . With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.

Next Steps:

It’s always worth thinking about the different groups who own shares in a company. But to understand Phivida Holdings better, we need to consider many other factors.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at [email protected] This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.