Yahoo Finance With 44% ownership, Magnetic Resources NL (ASX:MAU) insiders have a lot at stake
Key Insights
Significant insider control over Magnetic Resources implies vested interests in company growth
A total of 5 investors have a majority stake in the company with 50% ownership
Past performance of a company along with ownership data serve to give a strong idea about prospects for a business
If you want to know who really controls Magnetic Resources NL (ASX:MAU), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 44% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
So it follows, every decision made by insiders of Magnetic Resources regarding the company's future would be crucial to them.
In the chart below, we zoom in on the different ownership groups of Magnetic Resources.
See our latest analysis for Magnetic Resources
What Does The Lack Of Institutional Ownership Tell Us About Magnetic Resources?
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Magnetic Resources' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
We note that hedge funds don't have a meaningful investment in Magnetic Resources. Chimseng Oan is currently the largest shareholder, with 14% of shares outstanding. Hian Chan is the second largest shareholder owning 12% of common stock, and Dale Alcock Homes Pty. Ltd. holds about 11% of the company stock. Additionally, the company's CEO George Sakalidis directly holds 3.3% of the total shares outstanding.
Our research also brought to light the fact that roughly 50% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.
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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Magnetic Resources
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
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.
Our most recent data indicates that insiders own a reasonable proportion of Magnetic Resources NL. Insiders have a AU$110m stake in this AU$250m business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 25% stake in the company, and hence can't easily be ignored. 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 Company Ownership
It seems that Private Companies own 31%, of the Magnetic Resources stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Magnetic Resources better, we need to consider many other factors. For example, we've discovered 4 warning signs for Magnetic Resources (2 are significant!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
