U.S. Markets closed
  • S&P Futures

    3,274.00
    -28.25 (-0.86%)
     
  • Dow Futures

    26,390.00
    -167.00 (-0.63%)
     
  • Nasdaq Futures

    11,197.50
    -145.25 (-1.28%)
     
  • Russell 2000 Futures

    1,548.90
    -9.50 (-0.61%)
     
  • Crude Oil

    36.40
    +0.23 (+0.64%)
     
  • Gold

    1,871.80
    +3.80 (+0.20%)
     
  • Silver

    23.51
    +0.15 (+0.64%)
     
  • EUR/USD

    1.1688
    +0.0010 (+0.0818%)
     
  • 10-Yr Bond

    0.8350
    +0.0540 (+6.91%)
     
  • Vix

    37.59
    -2.69 (-6.68%)
     
  • GBP/USD

    1.2936
    +0.0013 (+0.0970%)
     
  • USD/JPY

    104.4690
    -0.1410 (-0.1348%)
     
  • BTC-USD

    13,447.03
    +16.36 (+0.12%)
     
  • CMC Crypto 200

    265.74
    +23.06 (+9.50%)
     
  • FTSE 100

    5,581.75
    -1.05 (-0.02%)
     
  • Nikkei 225

    23,152.24
    -179.70 (-0.77%)
     

Do Insiders Own Lots Of Shares In Cortland Bancorp (NASDAQ:CLDB)?

Simply Wall St

Want to participate in a research study? Help shape the future of investing tools and earn a $60 gift card!

The big shareholder groups in Cortland Bancorp (NASDAQ:CLDB) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

With a market capitalization of US$104m, Cortland Bancorp is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions own shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about CLDB.

See our latest analysis for Cortland Bancorp

NasdaqCM:CLDB Ownership Summary, April 4th 2019
NasdaqCM:CLDB Ownership Summary, April 4th 2019

What Does The Institutional Ownership Tell Us About Cortland Bancorp?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Cortland Bancorp does have institutional investors; and they hold 9.0% of the 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. 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 Cortland Bancorp's historic earnings and revenue, below, but keep in mind there's always more to the story.

NasdaqCM:CLDB Income Statement, April 4th 2019
NasdaqCM:CLDB Income Statement, April 4th 2019

It would appear that 7.5% of Cortland Bancorp shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Cortland Bancorp

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.

Our information suggests that insiders maintain a significant holding in Cortland Bancorp. It has a market capitalization of just US$104m, and insiders have US$11m worth of shares in their own names. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are mostly retail investors, collectively hold 73% of Cortland Bancorp shares. This size of ownership gives retail investors collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.