Yahoo Finance Individual investors who hold 46% of HUB24 Limited (ASX:HUB) gained 3.0%, institutions profited as well
Key Insights
Significant control over HUB24 by individual investors implies that the general public has more power to influence management and governance-related decisions
The top 19 shareholders own 50% of the company
Insiders have been buying lately
To get a sense of who is truly in control of HUB24 Limited (ASX:HUB), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 46% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).
While individual investors were the group that reaped the most benefits after last week’s 3.0% price gain, institutions also received a 43% cut.
In the chart below, we zoom in on the different ownership groups of HUB24.
View our latest analysis for HUB24
What Does The Institutional Ownership Tell Us About HUB24?
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.
As you can see, institutional investors have a fair amount of stake in HUB24. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at HUB24's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in HUB24. Our data shows that Hyperion Asset Management Limited is the largest shareholder with 8.4% of shares outstanding. Pinnacle Investment Management Group Limited is the second largest shareholder owning 7.9% of common stock, and Thorney Investment Group Australia Pty. Ltd. holds about 5.9% of the company stock. In addition, we found that Andrew Alcock, the CEO has 1.3% of the shares allocated to their name.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 19 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of HUB24
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.
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 report that insiders do own shares in HUB24 Limited. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around AU$152m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 46% 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 Equity Ownership
With a stake of 5.9%, private equity firms could influence the HUB24 board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
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.
