SomaLogic, Inc.’s (NASDAQ:SLGC) latest 11% decline adds to one-year losses, institutional investors may consider drastic measures

Important Findings

• The sizeable institutional holdings in SomaLogic imply that they have a significant impact on the company’s share price
• The 14 largest shareholders own 51% of the company
• Owner research along with forecast data from analysts help better understand a stock’s opportunities

To get a sense of who really controls SomaLogic, Inc. (NASDAQ:SLGC), it’s important to understand the company’s ownership structure. The group with the most shares in the company, around 54%, are institutions. That is, the group will benefit most when the stock goes up (or lose most when it goes down).

And institutional investors saw their holdings fall 11% last week. This group of investors might be particularly concerned about the current loss, which adds to a 68% year-over-year loss for shareholders. Institutions or “liquidity providers” control large sums of money and therefore these types of investors usually have a large influence on stock price movements. Therefore, if the decline continues, institutional investors could be pressured to sell SomaLogic, which could hurt individual investors.

Let’s dive deeper into each SomaLogic owner type, starting with the table below.

Check out our latest analysis for SomaLogic

What Does Institutional Ownership Tell Us About SomaLogic?

Many institutions measure their performance against an index that approximates the local market. As a result, they tend to pay more attention to companies that are included in major indices.

SomaLogic already has institutions on the share register. In fact, they own a respectable stake in the company. This means that the analysts who work for these institutes have looked at the stock and like it. But just like everyone else, they can be 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 reviewing SomaLogic’s earnings history to date (below). Of course, keep in mind that there are other factors to consider as well.

With institutional investors owning more than half of the outstanding shares, the board likely needs to be mindful of their preferences. Hedge funds don’t have a lot of stakes in SomaLogic. The company’s largest shareholder is Casdin Capital, LLC with a 6.7% stake. The second and third largest shareholders are Novartis AG and BlackRock, Inc., each owning an equal number of shares at 5.5%.

After digging further, we found that the top 14 collectively own 51% of the company, suggesting that no single shareholder has significant control over the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiment to know which way the wind is blowing. Quite a few analysts cover the stock, so you can easily look at the projected growth.

Insider ownership of SomaLogic

While the precise definition of an insider can be subjective, almost everyone considers a board member to be an insider. Management ultimately reports to the board of directors. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.

Most view insider ownership as a positive, as it can indicate that the board is well aligned with other shareholders. In some cases, however, too much power is concentrated within this group.

We can see that insiders own SomaLogic, Inc. stock. It has a market cap of just $446 million, and insiders have $13 million worth of shares in their own names. It’s good to see some insider investments, but it might be worth checking to see if those insiders bought.

General Public Property

With a 27% stake, the general public, which consists primarily of individual investors, has some influence over SomaLogic. 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

Private equity firms hold a 6.7% stake in SomaLogic. This indicates that they can influence important political decisions. 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.

Private company property

It appears that private companies own 3.6% of SomaLogic stock. Private companies can be related parties. Sometimes insiders have an interest in a public company through an interest in a private company rather than in their own capacity as an individual. Although it is difficult to draw general conclusions, it is worth noting that this is an area for further research.

ownership of public companies

It appears to us that public companies own 5.5% of SomaLogic. It’s hard to say for sure, but this suggests they may have intertwined business interests. This could be a strategic investment, so it’s worth watching for ownership changes in this area.

Next Steps:

It’s always worth thinking about the different groups that own shares in a company. But to better understand SomaLogic, we need to consider many other factors. Think of risks, for example. Every company has them and we discovered them 2 warning signs for SomaLogic you should know.

If you’d rather learn what analysts are predicting for future growth, don’t miss this one free Analyst forecast report.

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.

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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.