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To get a sense of who is truly in control of RxSight, Inc. (NASDAQ:RXST), it is important to understand the ownership structure of the business. We can see that institutions own the lion’s share in the company with 75% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Institutional investors would appreciate the 6.4% increase in share price last week, given their one-year losses have totalled a disappointing 1.6%.
Let’s delve deeper into each type of owner of RxSight, beginning with the chart below.
NasdaqGM:RXST Ownership Breakdown December 20th 2024
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 have a fair amount of stake in RxSight. 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 RxSight’s earnings history below. Of course, the future is what really matters.
NasdaqGM:RXST Earnings and Revenue Growth December 20th 2024
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don’t have a meaningful investment in RxSight. The company’s largest shareholder is RA Capital Management, L.P., with ownership of 9.7%. BlackRock, Inc. is the second largest shareholder owning 6.9% of common stock, and The Vanguard Group, Inc. holds about 5.7% of the company stock. Additionally, the company’s CEO Ronald Kurtz directly holds 2.1% of the total shares outstanding.
Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 17 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
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.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
We can see that insiders own shares in RxSight, Inc.. This is a big company, so it is good to see this level of alignment. Insiders own US$74m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.
With a 11% ownership, the general public, mostly comprising of individual investors, have some degree of sway over RxSight. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.
With a stake of 9.7%, private equity firms could influence the RxSight board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.
It’s always worth thinking about the different groups who own shares in a company. But to understand RxSight better, we need to consider many other factors. Case in point: We’ve spotted 1 warning sign for RxSight you should be aware of.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this freereport 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.
