Yahoo Finance Individual investors among Northern Minerals Limited's (ASX:NTU) largest stockholders and were hit after last week's 12% price drop
Key Insights
Northern Minerals' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
The top 18 shareholders own 51% of the company
A look at the shareholders of Northern Minerals Limited (ASX:NTU) can tell us which group is most powerful. We can see that individual investors own the lion's share in the company with 49% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
As a result, individual investors as a group endured the highest losses last week after market cap fell by AU$24m.
In the chart below, we zoom in on the different ownership groups of Northern Minerals.
Check out our latest analysis for Northern Minerals
What Does The Institutional Ownership Tell Us About Northern Minerals?
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.
Less than 5% of Northern Minerals is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.
Hedge funds don't have many shares in Northern Minerals. Looking at our data, we can see that the largest shareholder is Yuxiao Fund Pte Ltd with 9.8% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.3% and 4.2% of the stock.
Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 18 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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 is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Northern Minerals
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.
Our most recent data indicates that insiders own a reasonable proportion of Northern Minerals Limited. Insiders have a AU$33m stake in this AU$177m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 49% stake in Northern Minerals. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Company Ownership
It seems that Private Companies own 29%, of the Northern Minerals stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Northern Minerals better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for Northern Minerals you should be aware of, and 3 of them are a bit concerning.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
