Every investor in Ainsworth Game Technology Limited (ASX: AGI) should know about the most powerful shareholder groups. Large companies usually have institutions as shareholders, and we usually see insiders holding shares in smaller companies. I generally like to see some degree of insider ownership, even if it’s just a little. As Nassim Nicholas Taleb said, âDon’t tell me what you think, tell me what you have in your wallet.
With a market cap of AU $ 465 million, Ainsworth Game Technology is a small cap stock, so it may not be well known to many institutional investors. Looking at our data on ownership groups (below), it looks like institutional investors bought the company. Let’s take a closer look at what different types of shareholders can tell us about Ainsworth Game Technology.
See our latest review for Ainsworth Game Technology
What does institutional ownership tell us about Ainsworth gaming technology?
Many institutions measure their performance against an index that approximates the local market. Thus, they generally pay more attention to companies that are included in the major indices.
As you can see, institutional investors have a significant stake in Ainsworth Game Technology. This suggests some credibility among professional investors. But we cannot rely on this fact alone because institutions sometimes make bad investments, like everyone else. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell stocks quickly. This risk is higher in a company with no history of growth. You can see Ainsworth Game Technology’s historical revenue and revenue below, but keep in mind that there is always more to tell.
We note that the hedge funds do not have a significant investment in Ainsworth Game Technology. Our data shows that Johann Graf is the largest shareholder with 53% of the shares outstanding. With such a huge stake in the property, we infer that they have significant control over the future of the business. In comparison, the second and third shareholders hold around 8.9% and 7.4% of the capital.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand the expected performance of a stock. There are a reasonable number of analysts covering the stock, so it can be helpful to know their overall vision for the future.
Ainsworth Gaming Technology Insider Property
The definition of an insider may differ slightly from country to country, but board members still count. The management of the company is accountable to the board of directors and the board must represent the interests of the shareholders. Notably, sometimes senior executives themselves sit on the board of directors.
Insider ownership is positive when it indicates that executives think like the real owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
Our information suggests that insiders own more than half of Ainsworth Game Technology Limited. This gives them effective control of the business. Considering that it has a market cap of A $ 465 million, that means they have stocks worth A $ 268 million. Most would say this is a positive, showing strong alignment with shareholders. You can click here to see if these insiders have bought or sold.
General public property
With 16% ownership, the general public has some influence over Ainsworth Game Technology. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in line with other large shareholders.
Owned by a private company
It can be seen that private companies hold 9.8% of the shares issued. It is difficult to draw conclusions from this fact alone, so it is worth considering who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.
I find it very interesting to see who exactly owns a company. But to really get an overview, we have to take other information into account as well. To do this, you need to know the 1 warning sign we spotted with Ainsworth Game Technology.
If you are like me, you might want to ask yourself if this business will grow or shrink. Fortunately, you can check out this free report showing analysts’ forecasts for its future.
NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
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