While institutions own 20% of Acrow Formwork and Construction Services Limited (ASX:ACF), retail investors are its largest shareholders with 59% ownership
editorial-team@simplywallst.com (Simply Wall St)
4 min read
Key Insights
Acrow Formwork and Construction Services' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
Every investor in Acrow Formwork and Construction Services Limited (ASX:ACF) should be aware of the most powerful shareholder groups. With 59% stake, retail investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And institutions on the other hand have a 20% ownership in the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.
Let's delve deeper into each type of owner of Acrow Formwork and Construction Services, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Acrow Formwork and Construction Services?
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.
Acrow Formwork and Construction Services already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Acrow Formwork and Construction Services' historic earnings and revenue below, but keep in mind there's always more to the story.
ASX:ACF Earnings and Revenue Growth October 25th 2023
Acrow Formwork and Construction Services is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Perennial Value Management Limited with 9.5% of shares outstanding. With 4.9% and 4.4% of the shares outstanding respectively, Keneco Property Pty Ltd and Peter Lancken are the second and third largest shareholders. Peter Lancken, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. Additionally, the company's CEO Steven Boland directly holds 0.8% of the total shares outstanding.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Acrow Formwork and Construction Services
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 most recent data indicates that insiders own a reasonable proportion of Acrow Formwork and Construction Services Limited. Insiders own AU$26m worth of shares in the AU$234m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public -- including retail investors -- own 59% of Acrow Formwork and Construction Services. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Private Company Ownership
Our data indicates that Private Companies hold 10%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Acrow Formwork and Construction Services better, we need to consider many other factors. Take risks for example - Acrow Formwork and Construction Services has 4 warning signs (and 1 which is potentially serious) we think you should know about.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
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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.
