While insiders own 33% of Hammond Power Solutions Inc. (TSE:HPS.A), retail investors are its largest shareholders with 54% ownership
Key Insights
Hammond Power Solutions' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
A total of 25 investors have a majority stake in the company with 46% ownership
If you want to know who really controls Hammond Power Solutions Inc. (TSE:HPS.A), 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 54% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Individual insiders, on the other hand, account for 33% of the company's stockholders. 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 Hammond Power Solutions, beginning with the chart below.
See our latest analysis for Hammond Power Solutions
What Does The Institutional Ownership Tell Us About Hammond Power Solutions?
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 Hammond Power Solutions 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 Hammond Power Solutions' earnings history below. Of course, the future is what really matters.
Hammond Power Solutions is not owned by hedge funds. With a 31% stake, CEO William Hammond is the largest shareholder. In comparison, the second and third largest shareholders hold about 7.5% and 1.1% of the stock.
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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Hammond Power Solutions
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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.
Our most recent data indicates that insiders own a reasonable proportion of Hammond Power Solutions Inc.. Insiders own CA$168m worth of shares in the CA$512m company. 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, mostly comprising of individual investors, collectively holds 54% of Hammond Power Solutions 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. Case in point: We've spotted 1 warning sign for Hammond Power Solutions you should be aware of.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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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