Sanara MedTech Inc.'s (NASDAQ:SMTI) top owners are retail investors with 32% stake, while 31% is held by insiders
Key Insights
The considerable ownership by retail investors in Sanara MedTech indicates that they collectively have a greater say in management and business strategy
53% of the business is held by the top 3 shareholders
If you want to know who really controls Sanara MedTech Inc. (NASDAQ:SMTI), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 32% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).
Individual insiders, on the other hand, account for 31% of the company's stockholders. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.
In the chart below, we zoom in on the different ownership groups of Sanara MedTech.
See our latest analysis for Sanara MedTech
What Does The Institutional Ownership Tell Us About Sanara MedTech?
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.
As you can see, institutional investors have a fair amount of stake in Sanara MedTech. 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 Sanara MedTech, (below). Of course, keep in mind that there are other factors to consider, too.
Sanara MedTech is not owned by hedge funds. Catalyst Rochal, Llc is currently the largest shareholder, with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 12% and 11%, of the shares outstanding, respectively. Two of the top three shareholders happen to be Top Key Executive and Member of the Board of Directors, respectively. That is, insiders feature higher up in the heirarchy of the company's top shareholders.
After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Sanara MedTech
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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
It seems insiders own a significant proportion of Sanara MedTech Inc.. It has a market capitalization of just US$275m, and insiders have US$85m worth of shares in their own names. 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
With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Sanara MedTech. 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 Company Ownership
We can see that Private Companies own 30%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
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. For example, we've discovered 1 warning sign for Sanara MedTech that you should be aware of before investing here.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
