Key Insights
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Combined Motor Holdings' significant insider ownership suggests inherent interests in company's expansion
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The top 4 shareholders own 53% of the company
If you want to know who really controls Combined Motor Holdings Limited ( JSE:CMH ), 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 43% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
So, insiders of Combined Motor Holdings have a lot at stake and every decision they make on the company's future is important to them from a financial point of view.
In the chart below, we zoom in on the different ownership groups of Combined Motor Holdings.
See our latest analysis for Combined Motor Holdings
What Does The Institutional Ownership Tell Us About Combined Motor Holdings?
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.
Combined Motor Holdings already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Combined Motor Holdings, (below). Of course, keep in mind that there are other factors to consider, too.
Combined Motor Holdings is not owned by hedge funds. With a 35% stake, CEO Jebb McIntosh is the largest shareholder. For context, the second largest shareholder holds about 7.9% of the shares outstanding, followed by an ownership of 7.3% by the third-largest shareholder. Interestingly, the second-largest shareholder, Stuart Jackson is also Chief Financial Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.
On looking further, we found that 53% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.
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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of Combined Motor Holdings
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. 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.
Our information suggests that insiders maintain a significant holding in Combined Motor Holdings Limited. Insiders own R1.2b worth of shares in the R2.8b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 34% stake in Combined Motor Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
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 deeperinto how a company has performed in the past. You can find historic revenue and earnings in this detailed graph .
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future .
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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.
