Insiders hold 50% of OPKO Health, Inc. (NASDAQ:OPK), and they've been buying recently
Key Insights
Insiders appear to have a vested interest in OPKO Health's growth, as seen by their sizeable ownership
The top 4 shareholders own 51% of the company
To get a sense of who is truly in control of OPKO Health, Inc. (NASDAQ:OPK), it is important to understand the ownership structure of the business. With 50% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And looking at our data, we can see that insiders have bought shares recently. This might indicate that they expect share prices to rise in the near future.
In the chart below, we zoom in on the different ownership groups of OPKO Health.
View our latest analysis for OPKO Health
What Does The Institutional Ownership Tell Us About OPKO Health?
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.
OPKO Health 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of OPKO Health, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in OPKO Health. With a 35% stake, CEO Phillip Frost is the largest shareholder. The second and third largest shareholders are Gary Nabel and The Vanguard Group, Inc., with an equal amount of shares to their name at 5.8%. Interestingly, the second-largest shareholder, Gary Nabel is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.
Our research also brought to light the fact that roughly 51% 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 OPKO Health
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
It seems insiders own a significant proportion of OPKO Health, Inc.. Insiders own US$345m worth of shares in the US$695m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 21% stake in OPKO Health. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
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 be aware of the 2 warning signs we've spotted with OPKO Health .
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.
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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.
