If you want to know who really controls ImmunityBio, Inc. (NASDAQ:IBRX), then you’ll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.
With a market capitalization of US$5.9b, ImmunityBio is rather large. We’d expect to see institutional investors on the register. Companies of this size are usually well known to retail investors, too. Taking a look at our data on the ownership groups (below), it seems that institutions are noticeable on the share registry. Let’s delve deeper into each type of owner, to discover more about ImmunityBio.
What Does The Institutional Ownership Tell Us About ImmunityBio?
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 ImmunityBio. 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 ImmunityBio’s earnings history below. Of course, the future is what really matters.
Hedge funds don’t have many shares in ImmunityBio. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In ImmunityBio’s case, its Top Key Executive, Patrick Soon-Shiong, is the largest shareholder, holding 76% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 2.2% and 1.5%, of the shares outstanding, respectively.
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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of ImmunityBio
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Our most recent data indicates that insiders own the majority of ImmunityBio, Inc.. This means they can collectively make decisions for the company. Insiders own US$4.5b worth of shares in the US$5.9b company. That’s extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.
General Public Ownership
With a 13% ownership, the general public have some degree of sway over ImmunityBio. 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.
It’s always worth thinking about the different groups who own shares in a company. But to understand ImmunityBio better, we need to consider many other factors. For example, we’ve discovered 6 warning signs for ImmunityBio (2 don’t sit too well with us!) that you should be aware of before investing here.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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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