Institutions along with individual investors who hold considerable shares inGoPro, Inc. (NASDAQ:GPRO) come under pressure; lose 11% of holdings value

Key Insights

• The considerable ownership by individual investors in GoPro indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 50% of the company
• Insider ownership in GoPro is 25%

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A look at the shareholders of GoPro, Inc. (NASDAQ:GPRO) can tell us which group is most powerful. We can see that individual investors own the lion's share in the company with 45% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While institutions, who own 29% shares weren’t spared from last week’s US$22m market cap drop, individual investors as a group suffered the maximum losses

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

Check out our latest analysis for GoPro

What Does The Institutional Ownership Tell Us About GoPro?

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 GoPro does have institutional investors; and they hold a good portion of the company's stock. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see GoPro's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in GoPro. Looking at our data, we can see that the largest shareholder is the CEO Nicholas Woodman with 17% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.8% and 4.2% of the stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 GoPro

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 most recent data indicates that insiders own a reasonable proportion of GoPro, Inc.. It has a market capitalization of just US$193m, and insiders have US$49m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over GoPro. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 1 warning sign for GoPro that you should be aware of.

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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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.