To get a sense of who is truly in control of Spring Valley Acquisition Corp. II (NASDAQ:SVII), it is important to understand the ownership structure of the business. With 59% stake, individual investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Meanwhile, private equity firms make up 25% of the company’s shareholders.
Let's take a closer look to see what the different types of shareholders can tell us about Spring Valley Acquisition II.
What Does The Institutional Ownership Tell Us About Spring Valley Acquisition II?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
As you can see, institutional investors have a fair amount of stake in Spring Valley Acquisition II. 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 Spring Valley Acquisition II's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Spring Valley Acquisition II. Pearl Energy Investments is currently the largest shareholder, with 25% of shares outstanding. HighTower Advisors, LLC is the second largest shareholder owning 6.2% of common stock, and Goldman Sachs Group, Investment Banking and Securities Investments holds about 4.1% of the company stock.
On studying our ownership data, we found that 12 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
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 Spring Valley Acquisition II
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.
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.
Our most recent data indicates that insiders own less than 1% of Spring Valley Acquisition Corp. II. It appears that the board holds about US$1.2m worth of stock. This compares to a market capitalization of US$316m. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.
General Public Ownership
The general public -- including retail investors -- own 59% of Spring Valley Acquisition II. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.
Private Equity Ownership
With a stake of 25%, private equity firms could influence the Spring Valley Acquisition II board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
It's always worth thinking about the different groups who own shares in a company. But to understand Spring Valley Acquisition II better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Spring Valley Acquisition II (at least 2 which shouldn't be ignored) , and understanding them should be part of your investment process.
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.
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