Institutions along with private equity firms who hold considerable shares inCorsair Gaming, Inc. (NASDAQ:CRSR) come under pressure; lose 11% of holdings value
To get a sense of who is truly in control of Corsair Gaming, Inc. (NASDAQ:CRSR), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private equity firms with 56% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
While institutions, who own 23% shares weren’t spared from last week’s US$194m market cap drop, private equity firms as a group suffered the maximum losses
In the chart below, we zoom in on the different ownership groups of Corsair Gaming.
View our latest analysis for Corsair Gaming
What Does The Institutional Ownership Tell Us About Corsair Gaming?
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.
We can see that Corsair Gaming does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Corsair Gaming's earnings history below. Of course, the future is what really matters.
Corsair Gaming is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is EagleTree Capital, LP with 56% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. In comparison, the second and third largest shareholders hold about 5.8% and 4.4% of the stock. Additionally, the company's CEO Andrew Paul directly holds 2.6% of the total shares outstanding.
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 Corsair Gaming
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.
We can see that insiders own shares in Corsair Gaming, Inc.. The insiders have a meaningful stake worth US$47m. Most would see this as a real positive. It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 18% stake in Corsair Gaming. 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
Private equity firms hold a 56% stake in Corsair Gaming. This suggests they can be influential in key policy decisions. 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. Case in point: We've spotted 1 warning sign for Corsair Gaming you should be aware of.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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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