Yahoo Finance Rani Therapeutics Holdings, Inc.'s (NASDAQ:RANI) last week's 14% decline must have disappointed private companies who have a significant stake
Key Insights
Significant control over Rani Therapeutics Holdings by private companies implies that the general public has more power to influence management and governance-related decisions
The top 2 shareholders own 50% of the company
If you want to know who really controls Rani Therapeutics Holdings, Inc. (NASDAQ:RANI), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private companies with 48% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And last week, private companies endured the biggest losses as the stock fell by 14%.
Let's delve deeper into each type of owner of Rani Therapeutics Holdings, beginning with the chart below.
Check out our latest analysis for Rani Therapeutics Holdings
What Does The Institutional Ownership Tell Us About Rani Therapeutics Holdings?
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 Rani Therapeutics Holdings. 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 Rani Therapeutics Holdings, (below). Of course, keep in mind that there are other factors to consider, too.
Rani Therapeutics Holdings is not owned by hedge funds. South Lake Management LLC is currently the company's largest shareholder with 48% of shares outstanding. The Vanguard Group, Inc. is the second largest shareholder owning 2.6% of common stock, and GV Management Company, LLC holds about 2.0% of the company stock.
After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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 Rani Therapeutics Holdings
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.
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 Rani Therapeutics Holdings, Inc.. In their own names, insiders own US$4.0m worth of stock in the US$230m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public-- including retail investors -- own 39% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
It seems that Private Companies own 48%, of the Rani Therapeutics Holdings stock. 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:
It's always worth thinking about the different groups who own shares in a company. But to understand Rani Therapeutics Holdings better, we need to consider many other factors. Take risks for example - Rani Therapeutics Holdings has 2 warning signs (and 1 which can't be ignored) we think you should know about.
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.
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