In This Article:
The big shareholder groups in Arlo Technologies, Inc. (NYSE:ARLO) have power over the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. We also tend to see lower insider ownership in companies that were previously publicly owned.
Arlo Technologies is not a large company by global standards. It has a market capitalization of US$213m, which means it wouldn't have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions own shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about ARLO.
Check out our latest analysis for Arlo Technologies
What Does The Institutional Ownership Tell Us About Arlo Technologies?
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.
Arlo Technologies already has institutions on the share registry. Indeed, they own 85% of the company. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Arlo Technologies's historic earnings and revenue, below, but keep in mind there's always more to the story.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don't have a meaningful investment in Arlo Technologies. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Arlo Technologies
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Shareholders would probably be interested to learn that insiders own shares in Arlo Technologies, Inc.. As individuals, the insiders collectively own US$5.2m worth of the US$213m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.