Do Insiders Own Shares In Billing Services Group Limited (LON:BILL)?

A look at the shareholders of Billing Services Group Limited (LON:BILL) can tell us which group is most powerful. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.

Billing Services Group is a smaller company with a market capitalization of UK£3.1m, so it may still be flying under the radar of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Billing Services Group.

View our latest analysis for Billing Services Group

AIM:BILL Ownership Summary, January 27th 2020
AIM:BILL Ownership Summary, January 27th 2020

What Does The Institutional Ownership Tell Us About Billing Services Group?

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.

We can see that Billing Services Group does have institutional investors; and they hold 23% of the 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. 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 Billing Services Group, (below). Of course, keep in mind that there are other factors to consider, too.

AIM:BILL Income Statement, January 27th 2020
AIM:BILL Income Statement, January 27th 2020

Our data indicates that hedge funds own 21% of Billing Services Group. That’s interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. James Mellon is currently the company’s largest shareholder with 27% of shares outstanding. The second largest shareholder with 21%, is Hawkeye Capital Management, LLC, followed by ICM Limited, with an ownership of 14%.

Additionally, we found that 3 of the top shareholders have a considerable amount of ownership in the company, via their 62% stake.

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. As far I can tell there isn’t analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Billing Services Group

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems insiders own a significant proportion of Billing Services Group Limited. Insiders own UK£1.2m worth of shares in the UK£3.1m 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

With a 18% ownership, the general public have some degree of sway over BILL. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we’ve spotted 3 warning signs for Billing Services Group (of which 2 can’t be ignored!) you should know about.

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.

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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