Do the institutions own shares of Northam Platinum Holdings Limited (JSE: NPH)?
If you want to know who really controls Northam Platinum Holdings Limited (JSE: NPH), then you will need to look at the makeup of its share register. Generally speaking, as a business grows, institutions increase their participation. Conversely, insiders often decrease their ownership over time. We also tend to see a decrease in insider ownership in companies that were previously owned by the state.
Northam Platinum Holdings is a fairly large company. It has a market capitalization of R62b. Normally, institutions would own a significant share of a company of this size. In the graphic below, we can see that the institutions are visible on the share register. Let’s dig deeper into each type of owner to learn more about Northam Platinum Holdings.
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What does institutional ownership tell us about Northam Platinum Holdings?
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 businesses to have some institutions listed, especially if they are growing.
As you can see, institutional investors own a large stake in Northam Platinum Holdings. This suggests some credibility among professional investors. But we cannot rely on this fact alone because institutions sometimes make bad investments, like everyone else. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell stocks quickly. This risk is higher in a company without a history of growth. You can see Northam Platinum Holdings’ historic earnings and earnings below, but keep in mind that there is always more to tell.
Investors should note that institutions actually own more than half of the business, so they can collectively wield significant power. It appears that hedge funds hold 7.6% of the shares of Northam Platinum Holdings. This is interesting, because hedge funds can be very active and activist. Many are looking for medium-term catalysts that will drive up the share price. Public Investment Corporation Limited is currently the largest shareholder, with 17% of the shares outstanding. Meanwhile, the second and third largest shareholders hold 11% and 7.3% of the outstanding shares, respectively.
Upon closer inspection, we found that more than half of the company’s stock is owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are to some extent offset by the smaller ones.
While it makes sense to study a company’s institutional ownership data, it also makes sense to study analysts’ sentiments to know which way the wind is blowing. There are a lot of analysts covering the stock, so you can look at expected growth quite easily.
Insider ownership of Northam Platinum Holdings
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management ultimately reports to the board of directors. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.
Most view insider ownership as a positive, as it can indicate that 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 own shares of Northam Platinum Holdings Limited. It’s a big company, so it’s good to see that level of alignment. Insiders own shares worth R 1.0 billion (at current prices). It’s good to see this level of investment from the insiders. You can check here if these insiders have bought recently.
General public property
With a 30% stake, the general public has some influence over Northam Platinum Holdings. While this property size may not be enough to influence a policy decision in their favor, they can still have a collective impact on company policies.
It’s always worth thinking about the different groups that own shares in a company. But to better understand Northam Platinum Holdings, there are many other factors that we need to consider. Consider risks, for example. Every business has them, and we’ve spotted 3 warning signs for Northam Platinum Holdings you should know.
If you’d rather find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.
NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last day of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in the mentioned stocks.
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