key insights
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Significant retail investor ownership in Data #3 suggests that important decisions are influenced by larger public shareholders.
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The top 25 shareholders own 38% of the company
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Insiders have recently bought
A look at the shareholders of Data#3 Limited (ASX:DTL) can tell us which group is the most powerful. The group that owns the most shares in the company (about 60% to be exact) is individual investors. In other words, this group faces the greatest upside potential (or downside risk).
Meanwhile, institutional investors have an ownership of 32% in the company. Large companies usually have institutions as shareholders, and we often see insiders owning shares in smaller companies.
The chart below zooms in on the different ownership groups for Data #3.
Check out our latest analysis of data #3.
What does institutional ownership tell us about data #3?
Institutions typically measure a stock against a benchmark when reporting to their own investors, so enthusiasm for a stock often increases once it’s included in a major index. We would expect most companies to have some institutions on their register, especially if they are growing.
As you can see, institutional investors have a fair amount of stock in Data #3. This suggests some credibility among professional investors. But we can’t rely on that fact alone because institutions make bad investments sometimes, just like everyone does. 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 Data #3 (below). Of course, keep in mind that there are other factors to consider as well.
Data #3 is not owned by hedge funds. According to our data, State Street Global Advisors, Inc. is his largest shareholder with 5.3% of shares outstanding. On the other hand, the second and third largest shareholders hold about 5.0% of the stock and his own 3.2%.
Our research shows that the top 25 shareholders collectively control less than half of the company’s shares. This means that the company’s shares are widely distributed and there is no dominant shareholder.
Researching institutional ownership is a good way to assess and filter a stock’s expected performance. The same can be done by studying analyst sentiment. There are a significant number of analysts covering this stock, so it might be useful to know their aggregate forecast for the future.
Insider ownership of data #3
The definition of an insider may vary slightly from country to country, but members of the board of directors are always considered. A company’s management runs the business, but the CEO answers to the board, even if he or she is a member of the board.
Most consider insider ownership a positive, because it can indicate the board is well aligned with other shareholders. However, in some cases, too much power may be concentrated within this group.
We can report that insiders own shares in Data#3 Limited. Insiders own AU$48m worth of shares in the AU$1.3b company in their own names. Some might say this shows alignment of interests between shareholders and the board. But it might be worth checking if these insiders are selling.
Open to the public
The general public, mostly retail investors, collectively own 60% of Data#3 shares. This level of ownership gives retail investors a degree of power to influence important policy decisions such as board composition, executive compensation, and dividend payout ratios.
Private company ownership
Our data shows that Private companies own 5.1% of the company’s shares. Private companies may qualify as related parties. Insiders may have an interest in a public company through ownership in a private company rather than in their individual capacity. Although it is difficult to draw broad conclusions, it is worth noting as an area with room for further research.
Next steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Using risk as an example, Data #3 has the following characteristics: 1 warning sign I think you should know.
If you’re like me, you might want to consider whether this company will grow or shrink. Luckily you can check this free report showing analyst forecasts for its future.
Note: The numbers in this article are calculated using data from the previous 12 months and refer to the 12-month period ending on the last day of the month in which the financial statements are dated. This may not match the 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 using only unbiased methodologies, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
