Do Directors Own Hitech & Development Wireless Sweden Holding AB (publ) (STO:HDW B) Shares?

If you want to know who really controls Hitech & Development Wireless Sweden Holding AB (publ) (STO:HDW B), then you’ll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.

Hitech & Development Wireless Sweden Holding is not a large company by global standards. It has a market capitalization of kr52m, which means it wouldn’t have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it’s seems that institutional investors have not yet purchased much of the company. Let’s take a closer look to see what the different types of shareholder can tell us about Hitech & Development Wireless Sweden Holding.

View our latest analysis for Hitech & Development Wireless Sweden Holding

OM:HDW B Ownership Summary, February 7th 2020
OM:HDW B Ownership Summary, February 7th 2020

What Does The Institutional Ownership Tell Us About Hitech & Development Wireless Sweden Holding?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Institutions own less than 5% of Hitech & Development Wireless Sweden Holding. That indicates that the company is on the radar of some funds, but it isn’t particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it’s the future that counts most.

OM:HDW B Income Statement, February 7th 2020
OM:HDW B Income Statement, February 7th 2020

Hitech & Development Wireless Sweden Holding is not owned by hedge funds. With a 9.4% stake, CEO Pär Bergsten is the largest shareholder. With 1.7% and 1.4% of the shares outstanding respectively, Nordnet AB, Asset Management Arm and Avanza Fonder AB are the second and third largest shareholders.

A deeper look at our ownership data shows that the top 3 shareholders collectively hold less than 50% of the register, suggesting a large group of small holders where no one share holder has a majority.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock’s expected performance. 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 Hitech & Development Wireless Sweden Holding

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 see that insiders own shares in Hitech & Development Wireless Sweden Holding AB (publ). In their own names, insiders own kr4.9m worth of stock in the kr52m company. Some would say this shows alignment of interests between shareholders and the board, though I 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 retail investors — own 87% of Hitech & Development Wireless Sweden Holding. 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Like risks, for instance. Every company has them, and we’ve spotted 6 warning signs for Hitech & Development Wireless Sweden Holding (of which 3 shouldn’t be ignored!) you should know about.

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.

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.

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