Flywire Corporation’s (NASDAQ:FLYW) latest 5.8% decline adds to one-year losses, institutional investors may consider drastic measures
If you want to know who really controls Flywire Corporation (NYSE:FLYWIRE) you need to look at the composition of its stock register. We can see that institutions own the lion’s share of the company at 58%. In other words, the group will gain the most (or lose the most) from their investment in the company.
And institutional investors saw their holdings fall 5.8% last week. This group of investors may be particularly concerned about the current loss, which adds to a 9.8% year-on-year loss for shareholders. Institutions, also known as “smart money,” have a huge impact on how a stock’s price moves. Therefore, should Flywire’s stock price continue to be weak, institutional investors may feel compelled to sell the stock, which may not be ideal for retail investors.
Let’s take a closer look at what the different types of shareholders can tell us about Flywire.
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What Does Institutional Ownership Tell Us About Flywire?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they’re often more excited about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially as they grow.
As you can see, Flywire has significant institutional investors. This may indicate that the company has a certain level of credibility in the investor community. However, it’s best not to rely on the supposed confirmation that comes from institutional investors. They too are sometimes wrong. It’s not uncommon for the stock price to fall sharply when two large institutional investors attempt to sell a stock at the same time. So, it’s worth checking out Flywire’s earnings history so far (below). Of course, keep in mind that there are other factors to consider as well.
Investors should note that institutions actually own more than half of the company, so collectively they can wield significant power. Flywire is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Temasek Holdings (Private) Limited with 11% of the shares outstanding. Bain Capital, LP and The Vanguard Group, Inc. are the second- and third-largest shareholders with 11% and 6.7% of outstanding shares, respectively. In addition, we have noted that Michael Massaro, the CEO, is allocated 1.1% of the shares.
After investigating further, we found that the top 12 collectively own 50% of the company, suggesting that no single shareholder has significant control over the company.
Studying institutional ownership is a good way to gauge and filter a stock’s expected performance. The same can be done by studying analyst sentiment. Quite a few analysts cover the stock, so you can easily look at the projected growth.
Insider ownership of Flywire
The definition of corporate insider can be subjective and varies by jurisdiction. Our data reflects individual insiders and captures at least board members. The management of the company is accountable to the board of directors, which should represent the interests of the shareholders. It is noteworthy that sometimes high-ranking managers themselves sit on the board.
Insider ownership is positive when it signals leadership thinks like the true owners of the company. However, a high proportion of insiders can give immense power to even a small group within the organization. This can sometimes be negative.
We can report that insiders own shares in Flywire Corporation. The insiders have a significant stake worth $71 million. Most would see this as a really positive thing. If you’re interested in investigating insider targeting, you can click here to see if insiders bought or sold.
General Public Property
The general public, which are typically individual investors, own an 18% stake in Flywire. While this ownership size is substantial, it may not be enough to change company policy if the decision is not aligned with other major shareholders.
Private Equity Ownership
With a stake of 22%, private equity houses are able to help shape the corporate strategy with a focus on value creation. Some might like that because sometimes private equity are activists who hold management accountable. But sometimes private equity sells out after the company goes public.
I find it very interesting to see who exactly owns a company. But to really gain insight, we need to consider other information as well. For example, we discovered 3 Warning Signs for Flywire you should know before you invest here.
If you’re like me, you might want to think about whether this company is going to grow or shrink. Luckily, you can check out this free report that includes analyst forecasts for the future.
Note: The figures in this article are calculated using data for the last twelve months, relating to the 12-month period ending on the last date of the month to which the financial statements are dated. This may not tally with the annual report figures for the full year.
The assessment is complex, but we help to simplify it.
Find out if Flywire might be over or under priced by checking out our comprehensive analysis which includes the following Fair Value Estimates, Risks and Warnings, Dividends, Insider Trading and Financial Health.
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This Simply Wall St article is of a general nature. We provide comments based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended as financial advice. It is not a recommendation to buy or sell any stock and does not take into account your goals or financial situation. Our goal is to offer you long-term focused analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any of the stocks mentioned.