To get a sense of who is truly in control of Rezolve AI Limited (NASDAQ:RZLV), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 54% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
While insiders who own 27% came under pressure after market cap dropped to US$1.2b last week,retail investors took the most losses.
Let's take a closer look to see what the different types of shareholders can tell us about Rezolve AI.
NasdaqGM:RZLV Ownership Breakdown October 19th 2024
What Does The Lack Of Institutional Ownership Tell Us About Rezolve AI?
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. Alternatively, there might be something about the company that has kept institutional investors away. Rezolve AI's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
NasdaqGM:RZLV Earnings and Revenue Growth October 19th 2024
Rezolve AI is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Igor Lychagov with 17% of shares outstanding. Dblp Sea Cow Limited is the second largest shareholder owning 17% of common stock, and Cocoa Wagner holds about 4.7% of the company stock. Additionally, the company's CEO Daniel Wagner directly holds 2.2% of the total shares outstanding.
A deeper look at our ownership data shows that the top 8 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Rezolve AI
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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 information suggests that insiders maintain a significant holding in Rezolve AI Limited. It has a market capitalization of just US$1.2b, and insiders have US$326m worth of shares in their own names. That's quite significant. 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, mostly comprising of individual investors, collectively holds 54% of Rezolve AI shares. With this amount 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 vote on acquisitions or mergers that may not improve profitability.
Private Company Ownership
Our data indicates that Private Companies hold 19%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Rezolve AI better, we need to consider many other factors. Take risks for example - Rezolve AI has 5 warning signs (and 4 which are a bit unpleasant) we think you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this freelist 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.
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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.
