Are Institutions Heavily Invested In Infinity Pharmaceuticals, Inc.'s (NASDAQ:INFI) Shares?
The big shareholder groups in Infinity Pharmaceuticals, Inc. (NASDAQ:INFI) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Companies that used to be publicly owned tend to have lower insider ownership.
With a market capitalization of US$110m, Infinity Pharmaceuticals is a small cap stock, so it might not be well known by many institutional investors. In the chart below, we can see that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about Infinity Pharmaceuticals.
Check out our latest analysis for Infinity Pharmaceuticals
What Does The Institutional Ownership Tell Us About Infinity Pharmaceuticals?
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Infinity Pharmaceuticals 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. 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 Infinity Pharmaceuticals' earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 9.4% of Infinity Pharmaceuticals. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Our data shows that BVF Partners, L.P. is the largest shareholder with 9.4% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 6.7% of common stock, and The Vanguard Group, Inc. holds about 6.2% of the company stock. Additionally, the company's CEO Adelene Perkins directly holds 0.9% of the total shares outstanding.
A closer look at our ownership figures suggests that the top 18 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Infinity Pharmaceuticals
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.
We can see that insiders own shares in Infinity Pharmaceuticals, Inc.. In their own names, insiders own US$2.4m worth of stock in the US$110m company. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.
General Public Ownership
With a 41% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Infinity Pharmaceuticals. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Infinity Pharmaceuticals better, we need to consider many other factors. Take risks for example - Infinity Pharmaceuticals has 4 warning signs we think 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.
