A look at the shareholders of PaySign, Inc. (NASDAQ: PAYS) can tell us which group is more powerful. We can see that individual investors hold the lion’s share of the company with 44% ownership. In other words, the group faces the maximum upside potential (or downside risk).
While retail investors were the group that reaped the most benefit after last week’s 14% price gain, insiders also received a 39% cut.
In the table below, we zoom in on the different PaySign ownership groups.
Check opportunities and risks within the American computer industry.
What does institutional ownership tell us about PaySign?
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.
As you can see, institutional investors hold a sizeable share of PaySign. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see PaySign’s revenue and historical revenue below, but keep in mind there’s always more to tell.
Reportedly, 5.1% of PaySign shares are controlled by hedge funds. This is worth noting, as hedge funds are often quite active investors, who may try to influence management. Many want value creation (and a rise in share price) in the short to medium term. Looking at our data, we can see that the largest shareholder is Daniel Spence with 18% of the shares outstanding. For context, the second shareholder owns approximately 18% of the outstanding shares, followed by a 5.1% stake by the third shareholder. Mark Newcomer, who is the second largest shareholder, also holds the title of managing director.
Upon closer inspection, we found that more than half of the company’s shares are held by the top 10 shareholders, suggesting that the interests of larger shareholders are to some extent balanced by those of smaller ones.
Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. There are plenty of analysts covering the stock, so it might be interesting to see what they are predicting as well.
Insider Ownership of PaySign
The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.
Our most recent data indicates that insiders own a reasonable proportion of PaySign, Inc. Insiders own a $52 million stake in this $134 million company. This may suggest that the founders still own a lot of shares. You can click here to see if they bought or sold.
General public property
The general public, including retail investors, owns 44% of the company’s shares and therefore cannot be easily ignored. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
It is always useful to think about the different groups that own shares in a company. But to better understand PaySign, we need to consider many other factors. For example, we found 1 warning sign for PaySign which you should be aware of before investing here.
If you’re like me, you might want to ask yourself if this business will grow or shrink. Luckily, you can check out this free report showing analyst predictions for its future.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month the financial statements are dated. This may not be consistent with the annual report figures for the full year.
Valuation is complex, but we help make it simple.
Find out if PaySign is potentially overvalued or undervalued by viewing our full analysis, which includes fair value estimates, risks and warnings, dividends, insider trading and financial health.
See the free analysis
Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
#PaySign #NASDAQPAYS #market #capitalization #increased #million #week #retail #investors #benefited #insiders