New Zealand’s large shareholding group King Salmon Investments Limited (NZSE: NZK) has power over the company. In general, as the company grows, the institution will increase its ownership. On the other hand, insiders often reduce their ownership over time. Warren Buffett says he likes “businesses with a sustainable competitive advantage run by capable, owner-oriented people.” So, it’s nice to see inside ownership, as it might suggest that management is owner-oriented.
With a market cap of NZ $ 229 million, New Zealand King Salmon Investments is a small cap, so it may not be well known to many institutional investors. Looking at our data on ownership groups (below), it appears that the institution owns a stake in the company. Let’s take a closer look to see what different types of shareholders can tell you about the New Zealand King Salmon Investments.
What Does Institutional Ownership Tell Us About New Zealand King Salmon Investments?
Institutions usually measure themselves against benchmarks when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in the main index. We expect most companies to have multiple institutions listed, especially if they grow.
We can see that New Zealand King Salmon Investments has institutional investors; and they hold most of the company’s stock. This can show that the company has a certain level of credibility in the investment community. However, it is best to exercise caution in relying on the validations that are supposed to be included with institutional investors. They too, sometimes get it wrong. When multiple institutions own shares, there is always a risk that they are in a ‘busy trade’. When such trades fail, multiple parties may compete to sell the stock quickly. This risk is higher in companies with no history of growth. You can view New Zealand King Salmon Investments’ historic earnings and revenues below, but keep in mind that there is always more to the story.
We note that hedge funds do not have a significant investment in New Zealand’s King Salmon Investments. Oregon Group Limited is currently the company’s largest shareholder with 40% of the outstanding shares. With 14% and 9.9% of shares outstanding respectively, New Zealand Central Securities Depository Limited, Asset Management Arm and China Resources (Holdings) Co., Ltd. is the second and third largest shareholder. In addition, the company’s CEO Grantley Rosewarne directly holds 2.7% of the total outstanding shares.
A more detailed study of the shareholder register shows us that the top 2 shareholders have a large share of ownership in the company, through their 54% stake.
While studying institutional ownership for a company can add value to your research, it is good practice to research analyst recommendations to gain a deeper understanding of the expected performance of a stock. Quite a number of analysts cover the stock, so you can easily see growth forecasts.
Insider Ownership of New Zealand King Salmon Investments
The definition of insider varies slightly from country to country, but members of the board of directors always count. Management is ultimately accountable to the board. However, it is not uncommon for managers to become members of the executive board, especially if they are founders or CEOs.
Most view insider ownership as a positive thing because it shows the board of directors well with other shareholders. However, on several occasions, too much power was concentrated within this group.
Our most recent data shows that insiders make up a fair proportion of New Zealand King Salmon Investments Limited. Insiders own a NZ $ 24 million stake in this NZ $ 229 million business. This may indicate that the founders still own a lot of shares. You can click here to see if they have bought or sold.
General General Ownership
The general public holds a 17% stake in New Zealand King Salmon Investments. While the group cannot just make decisions, it can definitely have a real impact on how the company is run.
Private Company Ownership
We can see that the Private Company owns 51%, of the issued shares. It might be worth looking into this a little deeper. If a related party, such as an insider, has an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have strategic interests in the company.
The next step:
It is always a good idea to think about the different groups that own shares in a company. But to better understand New Zealand’s King Salmon Investments, we need to consider many other factors.
I always want to check files history of income growth. You can too, by accessing these free charts historical income and income in this regard detailed charts.
If you would rather find analyst predictions in terms of future growth, don’t miss this Free reports analyst forecast.
NB: The figures in this article are calculated using data from the last twelve months, which refers to the 12 month period ending on the last date of the financial statement month. This may not be consistent with full year annual report figures.
This article by Simply Wall St is of a general nature. This does not constitute a recommendation to buy or sell any stock, and does not take into account your goals, or your financial situation. We aim to provide you with long-term focused analysis driven by fundamental data. Note that our analysis may not take into account price sensitive company announcements or recent qualitative material. Simply Wall St does not have a position in any of the shares mentioned.
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