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The major shareholder groups of Scott Technology Limited (NZSE: TBS) have power over the business. Large companies usually have institutions as shareholders, and we usually see insiders holding shares in smaller companies. Companies that have been privatized tend to have low insider ownership.
Scott Technology is not a large company by global standards. It has a market cap of NZ $ 229 million, which means it wouldn’t have the attention of many institutional investors. In the graphic below, we can see that the institutions are visible on the share register. We can zoom in on the different ownership groups to find out more about Scott Technology.
Check out our latest review for Scott Technology
What does institutional ownership tell us about Scott technology?
Many institutions measure their performance against an index that approximates the local market. Thus, they generally pay more attention to companies that are included in the major indices.
Scott Technology already has institutions on the share register. Indeed, they hold a respectable stake in the company. This implies that analysts working for these institutions have reviewed the title and appreciate it. But like everyone else, they could be wrong. It is not uncommon to see a sharp drop in the stock price if two large institutional investors attempt to sell a stock at the same time. So it’s worth checking out Scott Technology’s past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.
Hedge funds don’t have a lot of shares in Scott Technology. Our data shows that JBS SA is the largest shareholder with 52% of the shares outstanding. With such a huge stake in the property, we infer that they have significant control over the future of the business. Meanwhile, the second and third shareholders hold 7.0% and 1.9% of the outstanding shares, respectively.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand the expected performance of a stock. As far as I know, there is no analyst coverage of the company, so it probably goes under the radar.
Insider Property of Scott Technology
The definition of business insiders can be subjective and vary from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company manages the company, but the CEO will report to the board of directors, even if he is a member of the board.
Insider ownership is positive when it indicates that executives think like the real owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
Shareholders would likely be interested to learn that insiders own shares of Scott Technology Limited. As individuals, the insiders collectively own NZ $ 11 million of the NZ $ 229 million company. Some would say this shows the alignment of interests between shareholders and the board, although I generally prefer to see larger insider holdings. But it might be worth checking out if these insiders have sold.
General public property
With a 33% stake, the general public has some influence over Scott Technology. While this property size may not be enough to influence a policy decision in their favor, they can still have a collective impact on company policies.
Public enterprise ownership
Public companies currently own 52% of the shares of Scott Technology. It may be a strategic interest and the two companies may have related business interests. It could be that they defused. This exploitation probably deserves to be deepened.
Next steps:
While it is worth considering the different groups that own a business, there are other factors that are even more important. Take risks for example – Scott Technology has 2 warning signs (and 1 which is a bit unpleasant) we think you should know.
If you would rather consult with another company – one with potentially superior finances – then don’t miss this free list of interesting companies, supported by solid financial data.
NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last day of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative material. Simply Wall St has no position in any of the stocks mentioned.
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