bluebird bio, Inc.'s (NASDAQ:BLUE) top owners are retail investors with 51% stake, while 49% is held by institutions
Key Insights
Significant control over bluebird bio by retail investors implies that the general public has more power to influence management and governance-related decisions
The top 25 shareholders own 40% of the company
A look at the shareholders of bluebird bio, Inc. (NASDAQ:BLUE) can tell us which group is most powerful. The group holding the most number of shares in the company, around 51% 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).
And institutions on the other hand have a 49% ownership in the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones.
Let's take a closer look to see what the different types of shareholders can tell us about bluebird bio.
See our latest analysis for bluebird bio
What Does The Institutional Ownership Tell Us About bluebird bio?
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 bluebird bio. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 bluebird bio's historic earnings and revenue below, but keep in mind there's always more to the story.
We note that hedge funds don't have a meaningful investment in bluebird bio. Looking at our data, we can see that the largest shareholder is State Street Global Advisors, Inc. with 7.2% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.7% and 3.1%, of the shares outstanding, respectively.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of bluebird bio
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
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 less than 1% of bluebird bio, Inc.. It has a market capitalization of just US$184m, and the board has only US$833k worth of shares in their own names. 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 51% of bluebird bio. 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.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand bluebird bio better, we need to consider many other factors. Take risks for example - bluebird bio has 3 warning signs (and 2 which are concerning) we think you should know about.
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.
