Ikena Oncology, Inc.'s (NASDAQ:IKNA) largest shareholders are private equity firms with 46% ownership, institutions own 31%
Key Insights
Ikena Oncology's significant private equity firms ownership suggests that the key decisions are influenced by shareholders from the larger public
56% of the business is held by the top 4 shareholders
Every investor in Ikena Oncology, Inc. (NASDAQ:IKNA) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private equity firms with 46% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Meanwhile, institutions make up 31% of the company’s shareholders. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time.
In the chart below, we zoom in on the different ownership groups of Ikena Oncology.
Check out our latest analysis for Ikena Oncology
What Does The Institutional Ownership Tell Us About Ikena Oncology?
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.
Ikena Oncology already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Ikena Oncology's historic earnings and revenue below, but keep in mind there's always more to the story.
It looks like hedge funds own 13% of Ikena Oncology shares. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. OrbiMed Advisors LLC is currently the largest shareholder, with 26% of shares outstanding. With 14% and 9.1% of the shares outstanding respectively, Atlas Venture L.P. and FMR LLC are the second and third largest shareholders.
Our research also brought to light the fact that roughly 56% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.
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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Ikena Oncology
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.
Our data suggests that insiders own under 1% of Ikena Oncology, Inc. in their own names. It seems the board members have no more than US$1.0m worth of shares in the US$254m company. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 10% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Equity Ownership
With a stake of 46%, private equity firms could influence the Ikena Oncology board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 3 warning signs we've spotted with Ikena Oncology (including 1 which doesn't sit too well with us) .
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
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