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The big shareholder groups in Navin Fluorine International Limited (NSE:NAVINFLUOR) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.’
Navin Fluorine International is not a large company by global standards. It has a market capitalization of ₹32.39b, which means it wouldn’t have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let’s take a closer look to see what the different types of shareholder can tell us about NAVINFLUOR.
Check out our latest analysis for Navin Fluorine International
What Does The Institutional Ownership Tell Us About Navin Fluorine International?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that Navin Fluorine International does have institutional investors; and they hold 30.2% of the stock. 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 Navin Fluorine International, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don’t have a many shares in Navin Fluorine International. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Navin Fluorine International
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. I can report that insiders do own shares in Navin Fluorine International Limited. As individuals, the insiders collectively own ₹2.61b worth of the ₹32.39b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.