With 69% ownership in Atlanticus Holdings Corporation (NASDAQ:ATLC), insiders continue to have the largest holding even though they have sold shares recently
Key Insights
Significant insider control over Atlanticus Holdings implies vested interests in company growth
60% of the business is held by the top 2 shareholders
Every investor in Atlanticus Holdings Corporation (NASDAQ:ATLC) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 69% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And insiders own the top position in the company’s share registry despite recent sales.
Let's take a closer look to see what the different types of shareholders can tell us about Atlanticus Holdings.
See our latest analysis for Atlanticus Holdings
What Does The Institutional Ownership Tell Us About Atlanticus Holdings?
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 Atlanticus Holdings 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 Atlanticus Holdings' earnings history below. Of course, the future is what really matters.
Hedge funds don't have many shares in Atlanticus Holdings. The company's largest shareholder is Frank Hanna, with ownership of 30%. For context, the second largest shareholder holds about 30% of the shares outstanding, followed by an ownership of 5.1% by the third-largest shareholder. David Hanna, who is the second-largest shareholder, also happens to hold the title of Top Key Executive. Additionally, the company's CEO Jeffrey Howard directly holds 2.6% of the total shares outstanding.
To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.
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. There is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Atlanticus Holdings
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.
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.
Our information suggests that insiders own more than half of Atlanticus Holdings Corporation. This gives them effective control of the company. Given it has a market cap of US$410m, that means they have US$284m worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. 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.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Atlanticus Holdings better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Atlanticus Holdings you should be aware of, and 2 of them make us uncomfortable.
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.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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