Key Insights

• The considerable ownership by sovereign wealth funds in Lucid Group indicates that they collectively have a greater say in management and business strategy
• 59% of the company is held by a single shareholder (Public Investment Fund)
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Lucid Group, Inc. (NASDAQ:LCID) can tell us which group is most powerful. The group holding the most number of shares in the company, around 59% to be precise, is sovereign wealth funds. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, sovereign wealth funds as a group endured the highest losses last week after market cap fell by US$271m.

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

View our latest analysis for Lucid Group

What Does The Institutional Ownership Tell Us About Lucid Group?

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

Lucid Group is not owned by hedge funds. Public Investment Fund is currently the company's largest shareholder with 59% of shares outstanding. This implies that they have majority interest control of the future of the company. Meanwhile, the second and third largest shareholders, hold 2.8% and 1.4%, of the shares outstanding, respectively.

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 Lucid Group

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.

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.

We can see that insiders own shares in Lucid Group, Inc.. The insiders have a meaningful stake worth US$133m. Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 30% stake in Lucid Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Lucid Group better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Lucid Group you should be aware of, and 1 of them is a bit unpleasant.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.