Positive week for Adaptimmune Therapeutics plc (NASDAQ:ADAP) institutional investors who lost 68% over the past year
Key Insights
Institutions' substantial holdings in Adaptimmune Therapeutics implies that they have significant influence over the company's share price
A total of 8 investors have a majority stake in the company with 52% ownership
Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
To get a sense of who is truly in control of Adaptimmune Therapeutics plc (NASDAQ:ADAP), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 41% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Last week's US$14m market cap gain would probably be appreciated by institutional investors, especially after a year of 68% losses.
Let's delve deeper into each type of owner of Adaptimmune Therapeutics, beginning with the chart below.
View our latest analysis for Adaptimmune Therapeutics
What Does The Institutional Ownership Tell Us About Adaptimmune Therapeutics?
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.
Adaptimmune Therapeutics already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Adaptimmune Therapeutics' earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 17% of Adaptimmune Therapeutics. 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. Matrix Capital Management Company, LP is currently the largest shareholder, with 17% of shares outstanding. The second and third largest shareholders are Baillie Gifford & Co. and New Enterprise Associates, Inc., with an equal amount of shares to their name at 7.5%.
On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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 Adaptimmune Therapeutics
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
We can see that insiders own shares in Adaptimmune Therapeutics plc. It has a market capitalization of just US$128m, and insiders have US$1.6m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, who are usually individual investors, hold a 33% stake in Adaptimmune Therapeutics. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Equity Ownership
With an ownership of 7.5%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Adaptimmune Therapeutics better, we need to consider many other factors. Take risks for example - Adaptimmune Therapeutics has 3 warning signs (and 1 which shouldn't be ignored) we think you should know about.
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.
