Insiders of Biodesix, Inc. (NASDAQ:BDSX) must be frustrated after market cap dropped US$16m since recent purchases
Key Insights
Significant insider control over Biodesix implies vested interests in company growth
The top 3 shareholders own 54% of the company
Every investor in Biodesix, Inc. (NASDAQ:BDSX) should be aware of the most powerful shareholder groups. With 64% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
A quick look at our data suggests that insiders have been buying shares in the company recently. So the news of stock price falling by 11% is not something they might have been expecting soon after purchasing shares.
Let's delve deeper into each type of owner of Biodesix, beginning with the chart below.
View our latest analysis for Biodesix
What Does The Institutional Ownership Tell Us About Biodesix?
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.
As you can see, institutional investors have a fair amount of stake in Biodesix. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Biodesix's earnings history below. Of course, the future is what really matters.
It looks like hedge funds own 6.5% of Biodesix shares. 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. Looking at our data, we can see that the largest shareholder is Jack Schuler with 26% of shares outstanding. For context, the second largest shareholder holds about 19% of the shares outstanding, followed by an ownership of 9.0% by the third-largest shareholder. John Patience, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.
A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.
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 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 Biodesix
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.
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 information suggests that insiders own more than half of Biodesix, Inc.. This gives them effective control of the company. So they have a US$82m stake in this US$127m business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 12% stake in Biodesix. 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 7.8%, private equity firms could influence the Biodesix 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:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Biodesix has 4 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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