Syrah Resources Limited (ASX:SYR) most popular amongst individual investors who own 48% of the shares, institutions hold 44%
Syrah Resources' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
A total of 17 investors have a majority stake in the company with 50% ownership
If you want to know who really controls Syrah Resources Limited (ASX:SYR), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 48% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Institutions, on the other hand, account for 44% of the company's stockholders. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.
Let's take a closer look to see what the different types of shareholders can tell us about Syrah Resources.
See our latest analysis for Syrah Resources
What Does The Institutional Ownership Tell Us About Syrah Resources?
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.
We can see that Syrah Resources does have institutional investors; and they hold a good portion of the company's stock. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Syrah Resources' historic earnings and revenue below, but keep in mind there's always more to the story.
Hedge funds don't have many shares in Syrah Resources. AustralianSuper Pty. Ltd. is currently the largest shareholder, with 17% of shares outstanding. Paradice Investment Management Pty Ltd. is the second largest shareholder owning 7.8% of common stock, and Bruce Gray holds about 5.3% of the company stock.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 17 shareholders, meaning that no single shareholder has a majority interest in the ownership.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Syrah Resources
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
We can report that insiders do own shares in Syrah Resources Limited. In their own names, insiders own AU$64m worth of stock in the AU$1.1b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.
General Public Ownership
The general public-- including retail investors -- own 48% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
It's always worth thinking about the different groups who own shares in a company. But to understand Syrah Resources better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Syrah Resources , and understanding them should be part of your investment process.
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.
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