New Hope Corporation Limited's (ASX:NHC) largest shareholders are public companies with 40% ownership, individual investors own 33%
Key Insights
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The considerable ownership by public companies in New Hope indicates that they collectively have a greater say in management and business strategy
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The top 4 shareholders own 50% of the company
A look at the shareholders of New Hope Corporation Limited ( ASX:NHC ) can tell us which group is most powerful. The group holding the most number of shares in the company, around 40% to be precise, is public companies. Put another way, the group faces the maximum upside potential (or downside risk).
And individual investors on the other hand have a 33% ownership in the company.
Let's delve deeper into each type of owner of New Hope, beginning with the chart below.
See our latest analysis for New Hope
What Does The Institutional Ownership Tell Us About New Hope?
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.
We can see that New Hope does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 New Hope's earnings history below. Of course, the future is what really matters.
New Hope is not owned by hedge funds. WHSP Holdings Limited is currently the company's largest shareholder with 39% of shares outstanding. With 3.8% and 3.6% of the shares outstanding respectively, The Vanguard Group, Inc. and Morgan Stanley are the second and third largest shareholders.
Our research also brought to light the fact that roughly 50% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of New Hope
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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Shareholders would probably be interested to learn that insiders own shares in New Hope Corporation Limited. The insiders have a meaningful stake worth AU$63m. Most would see this as a real positive. Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.
General Public Ownership
With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over New Hope. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Public Company Ownership
Public companies currently own 40% of New Hope stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for New Hope (of which 1 makes us a bit uncomfortable!) you should know about.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.
