Significant control over Orchestra BioMed Holdings by individual investors implies that the general public has more power to influence management and governance-related decisions
54% of the business is held by the top 4 shareholders
To get a sense of who is truly in control of Orchestra BioMed Holdings, Inc. (NASDAQ:OBIO), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 26% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Hedge funds, on the other hand, account for 22% of the company's stockholders.
Let's take a closer look to see what the different types of shareholders can tell us about Orchestra BioMed Holdings.
NasdaqGM:OBIO Ownership Breakdown December 25th 2024
What Does The Institutional Ownership Tell Us About Orchestra BioMed 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 Orchestra BioMed Holdings. 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 Orchestra BioMed Holdings' earnings history below. Of course, the future is what really matters.
NasdaqGM:OBIO Earnings and Revenue Growth December 25th 2024
Our data indicates that hedge funds own 22% of Orchestra BioMed Holdings. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Our data shows that RTW Investments, LP is the largest shareholder with 22% of shares outstanding. With 15% and 12% of the shares outstanding respectively, Medtronic plc and Perceptive Advisors LLC are the second and third largest shareholders. Furthermore, CEO David Hochman is the owner of 1.1% of the company's shares.
Our research also brought to light the fact that roughly 54% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.
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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Orchestra BioMed Holdings
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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.
We can report that insiders do own shares in Orchestra BioMed Holdings, Inc.. As individuals, the insiders collectively own US$5.8m worth of the US$179m company. This shows at least some alignment, but we usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 26% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Private Equity Ownership
With an ownership of 12%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
Public Company Ownership
We can see that public companies hold 15% of the Orchestra BioMed Holdings shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
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.
