individual investors who own 55% along with institutions invested in Sangamo Therapeutics, Inc. (NASDAQ:SGMO) saw increase in their holdings value last week
The considerable ownership by individual investors in Sangamo Therapeutics indicates that they collectively have a greater say in management and business strategy
A total of 25 investors have a majority stake in the company with 40% ownership
To get a sense of who is truly in control of Sangamo Therapeutics, Inc. (NASDAQ:SGMO), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 55% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Following a 13% increase in the stock price last week, individual investors profited the most, but institutions who own 36% stock also stood to gain from the increase.
Let's delve deeper into each type of owner of Sangamo Therapeutics, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Sangamo Therapeutics?
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.
Sangamo Therapeutics already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Sangamo Therapeutics' historic earnings and revenue below, but keep in mind there's always more to the story.
earnings-and-revenue-growth
It would appear that 6.8% of Sangamo Therapeutics shares are controlled by hedge funds. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. Wasatch Advisors LP is currently the largest shareholder, with 9.6% of shares outstanding. Armistice Capital LLC is the second largest shareholder owning 6.8% of common stock, and The Vanguard Group, Inc. holds about 5.7% of the company stock.
A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Sangamo 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.
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.
Our data suggests that insiders own under 1% of Sangamo Therapeutics, Inc. in their own names. It seems the board members have no more than US$2.5m worth of shares in the US$354m company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.
General Public Ownership
The general public -- including retail investors -- own 55% of Sangamo Therapeutics. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
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.
