Assertio Holdings, Inc.'s (NASDAQ:ASRT) market cap dropped US$43m last week; individual investors who hold 60% were hit as were institutions

Simply Wall St · 09/15/2023 11:47

Key Insights

  • Assertio Holdings' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
  • 29% of the business is held by the top 25 shareholders
  • Insiders have sold recently

A look at the shareholders of Assertio Holdings, Inc. (NASDAQ:ASRT) can tell us which group is most powerful. The group holding the most number of shares in the company, around 60% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of individual investors took a hit after last week’s 14% price drop, institutions with their 38% holdings also suffered.

In the chart below, we zoom in on the different ownership groups of Assertio Holdings.

Check out our latest analysis for Assertio Holdings

NasdaqCM:ASRT Ownership Breakdown September 15th 2023

What Does The Institutional Ownership Tell Us About Assertio Holdings?

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 Assertio Holdings 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Assertio Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

NasdaqCM:ASRT Earnings and Revenue Growth September 15th 2023

Assertio Holdings is not owned by hedge funds. BlackRock, Inc. is currently the largest shareholder, with 4.2% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.0% and 3.0%, of the shares outstanding, respectively. In addition, we found that Daniel Peisert, the CEO has 0.5% of the shares allocated to their name.

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 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 Assertio Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 Assertio Holdings, Inc.. In their own names, insiders own US$5.5m worth of stock in the US$274m 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

The general public, who are usually individual investors, hold a substantial 60% stake in Assertio Holdings, suggesting it is a fairly popular stock. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

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. Case in point: We've spotted 4 warning signs for Assertio Holdings you should be aware of, and 3 of them are significant.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.