Yahoo Finance Great week for Brightcove Inc. (NASDAQ:BCOV) institutional investors after losing 42% over the previous year
Key Insights
Significantly high institutional ownership implies Brightcove's stock price is sensitive to their trading actions
A total of 6 investors have a majority stake in the company with 50% ownership
Past performance of a company along with ownership data serve to give a strong idea about prospects for a business
Every investor in Brightcove Inc. (NASDAQ:BCOV) should be aware of the most powerful shareholder groups. With 46% stake, institutions possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
After a year of 42% losses, last week’s 14% gain would be welcomed by institutional investors as a possible sign that returns might start trending higher.
Let's delve deeper into each type of owner of Brightcove, beginning with the chart below.
See our latest analysis for Brightcove
What Does The Institutional Ownership Tell Us About Brightcove?
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.
As you can see, institutional investors have a fair amount of stake in Brightcove. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Brightcove's earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 33% of Brightcove. 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. Looking at our data, we can see that the largest shareholder is Edenbrook Capital, Llc with 15% of shares outstanding. With 9.7% and 8.3% of the shares outstanding respectively, Lynrock Lake LP and Trigran Investments, Inc. are the second and third largest shareholders. Furthermore, CEO Marc DeBevoise is the owner of 1.2% of the company's shares.
On further inspection, we found that more than half the company's shares are owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Brightcove
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.
We can report that insiders do own shares in Brightcove Inc.. It has a market capitalization of just US$107m, and insiders have US$3.2m worth of shares, in their own names. 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
With a 18% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Brightcove. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
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 1 warning sign for Brightcove that you should be aware of before investing here.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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
