Key Insights
-
Given the large stake in the stock by institutions, Remgro's stock price might be vulnerable to their trading decisions
-
50% of the business is held by the top 14 shareholders
-
Past performance of a company along with ownership data serve to give a strong idea about prospects for a business
If you want to know who really controls Remgro Limited (JSE:REM), 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 47% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).
Last week’s 4.3% gain means that institutional investors were on the positive end of the spectrum even as the company has shown strong longer-term trends. One-year return to shareholders is currently 1.6% and last week’s gain was the icing on the cake.
Let's take a closer look to see what the different types of shareholders can tell us about Remgro.
See our latest analysis for Remgro
What Does The Institutional Ownership Tell Us About Remgro?
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.
As you can see, institutional investors have a fair amount of stake in Remgro. 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 Remgro, (below). Of course, keep in mind that there are other factors to consider, too.
Remgro is not owned by hedge funds. Our data shows that Public Investment Corporation Limited is the largest shareholder with 16% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.3% and 5.9% of the stock.
A closer look at our ownership figures suggests that the top 14 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Remgro
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.