Newfield Resources Limited (ASX:NWF) most popular amongst private companies who own 33%, insiders hold 31%
Key Insights
Significant control over Newfield Resources by private companies implies that the general public has more power to influence management and governance-related decisions
53% of the business is held by the top 7 shareholders
To get a sense of who is truly in control of Newfield Resources Limited (ASX:NWF), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 33% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And individual insiders on the other hand have a 31% ownership in the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones.
Let's delve deeper into each type of owner of Newfield Resources, beginning with the chart below.
Check out our latest analysis for Newfield Resources
What Does The Institutional Ownership Tell Us About Newfield Resources?
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.
Newfield Resources 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Newfield Resources, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Newfield Resources. Rustiyan Oen is currently the largest shareholder, with 25% of shares outstanding. With 6.4% and 5.6% of the shares outstanding respectively, QP & Co Pty Ltd and Sparkle Capital Pty Ltd are the second and third largest shareholders.
We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Newfield Resources
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own a reasonable proportion of Newfield Resources Limited. It has a market capitalization of just AU$292m, and insiders have AU$92m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 31% stake in Newfield Resources. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Company Ownership
It seems that Private Companies own 33%, of the Newfield Resources stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Newfield Resources that you should be aware of.
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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.
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