Key Insights

• Institutions' substantial holdings in BlackSky Technology implies that they have significant influence over the company's share price
• 52% of the business is held by the top 11 shareholders
• Insiders have been selling lately

To get a sense of who is truly in control of BlackSky Technology Inc. (NYSE:BKSY), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 33% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And things are looking up for institutional investors after the company gained US$50m in market cap last week. One-year return to shareholders is currently 33% and last week’s gain was the icing on the cake.

Let's take a closer look to see what the different types of shareholders can tell us about BlackSky Technology.

See our latest analysis for BlackSky Technology

What Does The Institutional Ownership Tell Us About BlackSky Technology?

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 BlackSky Technology. 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 BlackSky Technology, (below). Of course, keep in mind that there are other factors to consider, too.

It would appear that 17% of BlackSky Technology shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. AWM Investment Company Inc is currently the company's largest shareholder with 9.2% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.0% and 7.6%, of the shares outstanding, respectively. Furthermore, CEO Brian O’Toole is the owner of 1.0% of the company's shares.

A closer look at our ownership figures suggests that the top 11 shareholders have a combined ownership of 52% implying that no single shareholder has a majority.

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.

Insider Ownership Of BlackSky Technology

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 report that insiders do own shares in BlackSky Technology Inc.. It has a market capitalization of just US$409m, and insiders have US$16m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over BlackSky Technology. 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.

Private Equity Ownership

With a stake of 7.6%, private equity firms could influence the BlackSky Technology board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Public Company Ownership

It appears to us that public companies own 6.7% of BlackSky Technology. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand BlackSky Technology better, we need to consider many other factors. Take risks for example - BlackSky Technology has 4 warning signs (and 1 which can't be ignored) we think you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.