U.S. markets close in 6 hours 15 minutes
  • S&P 500

    4,553.39
    +3.61 (+0.08%)
     
  • Dow 30

    35,722.86
    +119.78 (+0.34%)
     
  • Nasdaq

    15,174.24
    -41.46 (-0.27%)
     
  • Russell 2000

    2,295.67
    -0.51 (-0.02%)
     
  • Crude Oil

    83.55
    +1.05 (+1.27%)
     
  • Gold

    1,807.50
    +25.60 (+1.44%)
     
  • Silver

    24.65
    +0.48 (+1.97%)
     
  • EUR/USD

    1.1647
    +0.0016 (+0.14%)
     
  • 10-Yr Bond

    1.6670
    -0.0090 (-0.54%)
     
  • GBP/USD

    1.3788
    -0.0008 (-0.06%)
     
  • USD/JPY

    113.8090
    -0.1790 (-0.16%)
     
  • BTC-USD

    63,280.03
    -2,069.06 (-3.17%)
     
  • CMC Crypto 200

    1,502.05
    -0.98 (-0.07%)
     
  • FTSE 100

    7,214.40
    +24.10 (+0.34%)
     
  • Nikkei 225

    28,804.85
    +96.27 (+0.34%)
     

Could The Kosmos Energy Ltd. (NYSE:KOS) Ownership Structure Tell Us Something Useful?

  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

If you want to know who really controls Kosmos Energy Ltd. (NYSE:KOS), then you'll have to look at the makeup of its share registry. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. Companies that used to be publicly owned tend to have lower insider ownership.

Kosmos Energy has a market capitalization of US$1.0b, so we would expect some institutional investors to have noticed the stock. In the chart below, we can see that institutions own shares in the company. Let's take a closer look to see what the different types of shareholders can tell us about Kosmos Energy.

View our latest analysis for Kosmos Energy

ownership-breakdown
ownership-breakdown

What Does The Institutional Ownership Tell Us About Kosmos Energy?

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 Kosmos Energy does have institutional investors; and they hold a good portion of the company's 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. 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 Kosmos Energy's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
earnings-and-revenue-growth

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Hedge funds don't have many shares in Kosmos Energy. BlackRock, Inc. is currently the company's largest shareholder with 9.9% of shares outstanding. For context, the second largest shareholder holds about 9.6% of the shares outstanding, followed by an ownership of 6.6% by the third-largest shareholder.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Kosmos Energy

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.

Shareholders would probably be interested to learn that insiders own shares in Kosmos Energy Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around US$19m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

With a 13% ownership, the general public have some degree of sway over Kosmos Energy. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we've spotted with Kosmos Energy .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.