Innoviz Technologies Ltd.'s (NASDAQ:INVZ) Market Cap Touched US$323m Last Week, Benefiting Both Retail Investors Who Own 45% as Well as Institutions

Simply Wall St ·  Nov 15, 2023 09:48

Key Insights

  • Significant control over Innoviz Technologies by retail investors implies that the general public has more power to influence management and governance-related decisions

  • 49% of the business is held by the top 25 shareholders

  • 43% of Innoviz Technologies is held by Institutions

A look at the shareholders of Innoviz Technologies Ltd. (NASDAQ:INVZ) can tell us which group is most powerful.  We can see that retail investors own the lion's share in the company with 45% ownership.  Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that benefitted the most from last week's US$79m market cap gain, institutions too had a 43% share in those profits.    

Let's delve deeper into each type of owner of Innoviz Technologies, beginning with the chart below.

See our latest analysis for Innoviz Technologies

NasdaqCM:INVZ Ownership Breakdown November 15th 2023

What Does The Institutional Ownership Tell Us About Innoviz Technologies?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Innoviz Technologies.  This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong.  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 Innoviz Technologies, (below). Of course, keep in mind that there are other factors to consider, too.

NasdaqCM:INVZ Earnings and Revenue Growth November 15th 2023

Our data indicates that hedge funds own 7.0% of Innoviz Technologies.   That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher.      Fifthdelta Ltd is currently the largest shareholder, with 7.0% of shares outstanding.       For context, the second largest shareholder holds about 4.6% of the shares outstanding, followed by an ownership of 3.9% by the third-largest shareholder.      Furthermore, CEO Omer Keilaf is the owner of 3.2% of the company's shares.  

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments.   There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.  

Insider Ownership Of Innoviz Technologies

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders.  The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

We can report that insiders do own shares in Innoviz Technologies Ltd..   As individuals, the insiders collectively own US$14m worth of the US$323m company.   It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.  

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Innoviz Technologies.  This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.    Consider for instance, the ever-present spectre of investment risk.   We've identified 2 warning signs with Innoviz Technologies , and understanding them should be part of your investment process.  

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

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