Luna Innovations Incorporated (NASDAQ:LUNA) most popular amongst individual investors who own 45% of the shares, institutions hold 40%
If you want to know who really controls Luna Innovations Incorporated (NASDAQ:LUNA), then you'll have to look at the makeup of its share registry. With 45% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
Meanwhile, institutions make up 40% 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 Luna Innovations.
See our latest analysis for Luna Innovations
What Does The Institutional Ownership Tell Us About Luna Innovations?
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.
As you can see, institutional investors have a fair amount of stake in Luna Innovations. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Luna Innovations, (below). Of course, keep in mind that there are other factors to consider, too.
It would appear that 11% of Luna Innovations shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Royce & Associates, LP is currently the largest shareholder, with 6.0% of shares outstanding. ACK Asset Management LLC is the second largest shareholder owning 5.6% of common stock, and AMH Equity, Ltd. holds about 5.1% of the company stock. In addition, we found that Scott Graeff, the CEO has 1.6% of the shares allocated to their name.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Luna Innovations
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. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
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 Luna Innovations Incorporated. In their own names, insiders own US$5.8m worth of stock in the US$147m 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
The general public, who are usually individual investors, hold a 45% stake in Luna Innovations. 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.
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. Be aware that Luna Innovations is showing 2 warning signs in our investment analysis , and 1 of those is potentially serious...
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.
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