Institutions own 40% of Perma-Fix Environmental Services, Inc. (NASDAQ:PESI) shares but retail investors control 51% of the company
Key Insights
The considerable ownership by retail investors in Perma-Fix Environmental Services indicates that they collectively have a greater say in management and business strategy
The top 25 shareholders own 45% of the company
If you want to know who really controls Perma-Fix Environmental Services, Inc. (NASDAQ:PESI), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 51% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).
Institutions, on the other hand, account for 40% of the company's stockholders. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.
In the chart below, we zoom in on the different ownership groups of Perma-Fix Environmental Services.
Check out our latest analysis for Perma-Fix Environmental Services
What Does The Institutional Ownership Tell Us About Perma-Fix Environmental Services?
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.
Perma-Fix Environmental 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 Perma-Fix Environmental Services' historic earnings and revenue below, but keep in mind there's always more to the story.
Hedge funds don't have many shares in Perma-Fix Environmental Services. Looking at our data, we can see that the largest shareholder is Bankhaus Schelhammer & Schattera, Asset Management Arm with 14% of shares outstanding. With 4.3% and 3.7% of the shares outstanding respectively, The Vanguard Group, Inc. and Heartland Advisors, Inc. are the second and third largest shareholders. Additionally, the company's CEO Mark Duff directly holds 0.8% of the total shares outstanding.
A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Perma-Fix Environmental Services
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
We can report that insiders do own shares in Perma-Fix Environmental Services, Inc.. As individuals, the insiders collectively own US$9.7m worth of the US$108m company. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, mostly comprising of individual investors, collectively holds 51% of Perma-Fix Environmental Services shares. 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.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Perma-Fix Environmental Services you should know about.
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.
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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.
