Key Insights

• Institutions' substantial holdings in Emergent BioSolutions implies that they have significant influence over the company's share price

• A total of 25 investors have a majority stake in the company with 41% ownership

• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

A look at the shareholders of Emergent BioSolutions Inc. (NYSE:EBS) can tell us which group is most powerful. We can see that institutions own the lion's share in the company with 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Institutional investors endured the highest losses after the company's market cap fell by US$56m last week. However, the 91% one-year return to shareholders may have helped lessen their pain. They should, however, be mindful of further losses in the future.

Let's delve deeper into each type of owner of Emergent BioSolutions, beginning with the chart below.

See our latest analysis for Emergent BioSolutions

What Does The Institutional Ownership Tell Us About Emergent BioSolutions?

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.

We can see that Emergent BioSolutions 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 Emergent BioSolutions' earnings history below. Of course, the future is what really matters.

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Emergent BioSolutions is not owned by hedge funds. The Vanguard Group, Inc. is currently the company's largest shareholder with 6.8% of shares outstanding. Charles Schwab Investment Management, Inc. is the second largest shareholder owning 5.9% of common stock, and BlackRock, Inc. holds about 3.6% of the company stock.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Emergent BioSolutions

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.

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 Emergent BioSolutions Inc.. In their own names, insiders own US$6.9m worth of stock in the US$354m company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Emergent BioSolutions. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Emergent BioSolutions better, we need to consider many other factors. Be aware that Emergent BioSolutions is showing 3 warning signs in our investment analysis , and 1 of those is significant...

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.