The considerable ownership by individual investors in Faron Pharmaceuticals Oy indicates that they collectively have a greater say in management and business strategy
A total of 11 investors have a majority stake in the company with 50% ownership
To get a sense of who is truly in control of Faron Pharmaceuticals Oy (LON:FARN), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Following a 11% decrease in the stock price last week, individual investors suffered the most losses, but insiders who own 33% stock also took a hit.
Let's delve deeper into each type of owner of Faron Pharmaceuticals Oy, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Faron Pharmaceuticals Oy?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that Faron Pharmaceuticals Oy does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Faron Pharmaceuticals Oy's earnings history below. Of course, the future is what really matters.
AIM:FARN Earnings and Revenue Growth November 6th 2023
We note that hedge funds don't have a meaningful investment in Faron Pharmaceuticals Oy. Our data shows that Timo Syrjälä is the largest shareholder with 19% of shares outstanding. With 5.3% and 5.0% of the shares outstanding respectively, Tom-Erik Lind and A&B (HK) Company Limited are the second and third largest shareholders. Furthermore, CEO Markku Jalkanen is the owner of 4.8% of the company's shares.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 11 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Faron Pharmaceuticals Oy
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.
It seems insiders own a significant proportion of Faron Pharmaceuticals Oy. Insiders own UK£59m worth of shares in the UK£175m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 50% stake in Faron Pharmaceuticals Oy. 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 8.0%, of the Faron Pharmaceuticals Oy stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Faron Pharmaceuticals Oy better, we need to consider many other factors. For instance, we've identified 4 warning signs for Faron Pharmaceuticals Oy (2 are a bit unpleasant) that you should be aware of.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this freereport 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.
