Celcuity Inc.'s (NASDAQ:CELC) large institutional owners must be happy as stock continues to impress, up 12% over the past week

Celcuity Inc. -4.75%

Celcuity Inc.

CELC

17.23

-4.75%

Key Insights

  • Institutions' substantial holdings in Celcuity implies that they have significant influence over the company's share price
  • The top 6 shareholders own 51% of the company
  • 14% of Celcuity is held by insiders

If you want to know who really controls Celcuity Inc. (NASDAQ:CELC), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are institutions with 30% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And as as result, institutional investors reaped the most rewards after the company's stock price gained 12% last week. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 96%.

Let's take a closer look to see what the different types of shareholders can tell us about Celcuity.

See our latest analysis for Celcuity

ownership-breakdown
NasdaqCM:CELC Ownership Breakdown April 3rd 2024

What Does The Institutional Ownership Tell Us About Celcuity?

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.

We can see that Celcuity does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Celcuity's earnings history below. Of course, the future is what really matters.

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NasdaqCM:CELC Earnings and Revenue Growth April 3rd 2024

It would appear that 13% of Celcuity shares are controlled by hedge funds. 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. The company's CEO Brian Sullivan is the largest shareholder with 9.9% of shares outstanding. For context, the second largest shareholder holds about 9.7% of the shares outstanding, followed by an ownership of 8.6% by the third-largest shareholder.

We did some more digging and found that 6 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Celcuity

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. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Celcuity Inc.. Insiders own US$92m worth of shares in the US$633m company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Celcuity. 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 a stake of 26%, private equity firms could influence the Celcuity board. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Celcuity (at least 1 which shouldn't be ignored) , and understanding them should be part of your investment process.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report 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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