Institutions' substantial holdings in Codexis implies that they have significant influence over the company's share price
The top 9 shareholders own 52% of the company
Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
A look at the shareholders of Codexis, Inc. (NASDAQ:CDXS) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are institutions with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And things are looking up for institutional investors after the company gained US$65m in market cap last week. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 92%.
Let's delve deeper into each type of owner of Codexis, beginning with the chart below.
NasdaqGS:CDXS Ownership Breakdown December 14th 2024
What Does The Institutional Ownership Tell Us About Codexis?
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.
Codexis 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. 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 Codexis, (below). Of course, keep in mind that there are other factors to consider, too.
NasdaqGS:CDXS Earnings and Revenue Growth December 14th 2024
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. It would appear that 11% of Codexis 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. Our data shows that Opaleye Management Inc. is the largest shareholder with 11% of shares outstanding. Casdin Capital, LLC is the second largest shareholder owning 10.0% of common stock, and BlackRock, Inc. holds about 8.5% of the company stock. In addition, we found that Stephen Dilly, the CEO has 0.6% of the shares allocated to their name.
We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
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 Codexis
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.
Shareholders would probably be interested to learn that insiders own shares in Codexis, Inc.. It has a market capitalization of just US$458m, and insiders have US$14m worth of shares, in their own names. 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, who are usually individual investors, hold a 18% stake in Codexis. 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 a stake of 10.0%, private equity firms could influence the Codexis board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.
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. Case in point: We've spotted 2 warning signs for Codexis you should be aware of.
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.
