Institutional investors in Dave Inc. (NASDAQ:DAVE) see US$61m decrease in market cap last week, although long-term gains have benefitted them.
In This Article:
Key Insights
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Institutions' substantial holdings in Dave implies that they have significant influence over the company's share price
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A total of 7 investors have a majority stake in the company with 52% ownership
If you want to know who really controls Dave Inc. (NASDAQ:DAVE), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 36% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Institutional investors was the group most impacted after the company's market cap fell to US$425m last week. However, the 422% one-year return to shareholders may have helped lessen their pain. They should, however, be mindful of further losses in the future.
Let's take a closer look to see what the different types of shareholders can tell us about Dave.
Check out our latest analysis for Dave
What Does The Institutional Ownership Tell Us About Dave?
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
We can see that Dave does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Dave, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Dave. Section 32, LLC is currently the largest shareholder, with 16% of shares outstanding. Jason Wilk is the second largest shareholder owning 12% of common stock, and Paras Chitrakar holds about 7.8% of the company stock. Jason Wilk, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.
We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.