A look at the shareholders of PaySign, Inc. can tell us. (NASDAQ: PAYS) for the strongest group. We can see that individual investors own the lion’s share of the company at 44%. In other words, the group faces the maximum possible risk (or downside risk).
While individual investors were the group that reaped the most benefits after last week’s 14% price increase, insiders also got a 39% cut.
In the chart below, we zoom in on PaySign’s different ownership groups.
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What does corporate ownership tell us about PaySign?
Many institutions benchmark their performance against an indicator that approximates the local market. So they usually pay more attention to the companies listed in the major indices.
As you can see, institutional investors own a fair stake in PaySign. 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 endorsements that come with institutional investors. They also get it wrong sometimes. When multiple institutions own a stock, there is always a risk that you will be in a “busy trade.” When such a trade goes wrong, multiple parties may compete to sell shares quickly. This risk is higher in a company that has no history of growth. You can see historical PaySign earnings and revenue below, but keep in mind that there’s always more to the story.
It appears that 5.1% of PaySign shares are controlled by hedge funds. This is noteworthy, since hedge funds are often very active investors, and may try to influence management. Many would like to see value creation (and stock price appreciation) in the short or medium term. Looking at our data, we can see that the largest shareholder is Daniel Spence with 18% of the shares outstanding. In context, the second largest shareholder owns about 18% of the shares outstanding, followed by 5.1% ownership by the third largest shareholder. Mark Newcomer, the second largest shareholder, also happens to hold the title of CEO.
Upon further examination, we find that more than half of the company’s shares are held by the 10 largest shareholders, indicating that the interests of the larger shareholders are more or less balanced with those of the smaller shareholders.
Researching institutional ownership is a good way to measure and filter the expected performance of a stock. The same can be achieved by studying the sentiments of analysts. There are plenty of analysts covering stocks, so it might be worth seeing what to expect as well.
Insider Ownership by PaySign
The definition of company insiders can be subjective and does not vary across jurisdictions. Our data reflects individual insiders, capturing directors at the very least. The management of the company runs the business, but the CEO will be accountable to the board of directors, even if he is a member of it.
Most consider insider ownership a positive because it can indicate that the board of directors is well aligned with other shareholders. However, in some cases, a lot of power is concentrated within this group.
Our most recent data indicates that Insiders own a reasonable percentage of PaySign, Inc.. Insiders own a $52 million stake in this $134 million business. This may indicate that the founders still own a lot of stock. You can click here to see if they are buying or selling.
The general public – including retail investors – owns a 44% stake in the company and thus cannot be easily ignored. While this group cannot necessarily make decisions, it certainly can have a real impact on how the company is run.
It is always worth considering the different groups that own shares in the company. But to better understand PaySign, we need to consider many other factors. For example, we discovered 1 Warning Sign for PaySign You should be familiar with it before investing here.
If you’re like me, you might want to consider whether this company will grow or shrink. Fortunately, you can check out this free report presenting analysts’ forecasts for its future.
Note: The numbers in this article are calculated using data from the last twelve months, which refers to the 12-month period ending on the last date of the month in which the financial statement was dated. This may not be consistent with the annual report figures for the full year.
Evaluation is complex, but we help simplify it.
Find out if PaySign potentially overvalued or undervalued by checking out our comprehensive analysis, which includes Fair value estimates, risks, warnings, dividends, insider transactions and financial soundness.
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This article by Simply Wall St is general in nature. We provide comments based only on historical data and analyst expectations using an unbiased methodology and our articles are not intended as financial advice. It does not constitute a recommendation to buy or sell any stock, nor does it take into account your objectives or financial situation. We aim to provide you with focused, long-term analysis driven by essential data. Note that our analysis may not include the company’s most recent price-sensitive ads or quality materials. Wall Street simply has no position in any of the stocks mentioned.
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