Yahoo Finance Institutions own 38% of Anavex Life Sciences Corp. (NASDAQ:AVXL) shares but individual investors control 59% of the company
Key Insights
Significant control over Anavex Life Sciences by individual investors implies that the general public has more power to influence management and governance-related decisions
The top 25 shareholders own 37% of the company
Every investor in Anavex Life Sciences Corp. (NASDAQ:AVXL) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Meanwhile, institutions make up 38% of the company’s shareholders. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.
Let's delve deeper into each type of owner of Anavex Life Sciences, beginning with the chart below.
See our latest analysis for Anavex Life Sciences
What Does The Institutional Ownership Tell Us About Anavex Life Sciences?
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 Anavex Life Sciences. 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. 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 Anavex Life Sciences, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Anavex Life Sciences. State Street Global Advisors, Inc. is currently the company's largest shareholder with 8.6% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 7.9% of common stock, and The Vanguard Group, Inc. holds about 5.2% of the company stock. Furthermore, CEO Christopher Missling is the owner of 1.5% of the company's shares.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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 Anavex Life Sciences
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 Anavex Life Sciences Corp.. In their own names, insiders own US$11m worth of stock in the US$357m 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, who are usually individual investors, hold a substantial 59% stake in Anavex Life Sciences, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
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. For example, we've discovered 3 warning signs for Anavex Life Sciences (1 shouldn't be ignored!) 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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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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
