In this article, I’m going to take a look at Golden Energy Offshore Services AS’s (OB:GEOS-ME) latest ownership structure, a non-fundamental factor which is important, but remains a less discussed subject among investors. Ownership structure of a company has been found to affect share performance over time. The same amount of capital coming from an activist institution and a passive mutual fund has different implications on corporate governance, which is a decisive factor for a long-term investor. It also impacts the trading environment of company shares, which is more of a concern for short-term investors. Now I will analyze GEOS-ME’s shareholder registry in more detail.
Check out our latest analysis for Golden Energy Offshore Services
Institutional Ownership
Institutions account for 36.83% of GEOS-ME’s outstanding shares, a significant enough holding to move stock prices if they start buying and selling in large quantities, especially when there are relatively small amounts of shares available on the market to trade. However, as not all institutions are alike, such high volatility events, especially in the short-term, have been more frequently linked to active market participants like hedge funds. For GEOS-ME shareholders, the potential of this type of share price volatility shouldn’t be as concerning as hedge fund ownership is is not significant,indicating few chances of such sudden price moves. While that hardly seems concerning, I will explore further into GEOS-ME’s ownership type to find out how it can affect the company’s investment profile.General Public Ownership
The general public holds a substantial 41.12% stake in GEOS-ME, making it a highly popular stock among retail investors. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and potential acquisitions. This is a positive sign for an investor who wants to be involved in key decision-making of the company.Private Company Ownership
Another group of owners that a potential investor in GEOS-ME should consider are private companies, with a stake of 20.48%. While they invest more often due to strategic interests, an investment can also be driven by capital gains through share price appreciation. An ownership of this size indicates a strong financial backing and has the potential to influence GEOS-ME’s business strategy. Thus, investors should dig deeper into GEOS-ME’s business relations with these companies and how it can affect shareholder returns in the long-term.Next Steps:
The company’s high institutional ownership makes margin of safety a very important consideration to existing investors since long bull and bear trends often emerge when these big-ticket investors see a change in long-term potential of the company. This will allow investors to reduce the impact of non-fundamental factors, such as volatile block trading impact on their portfolio value. However, ownership structure should not be the only determining factor when you’re building an investment thesis for GEOS-ME. Rather, you should be looking at fundamental drivers such as Golden Energy Offshore Services’s past track record and financial health. I urge you to complete your research by taking a look at the following:
- Financial Health: Is GEOS-ME’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Valuation: What is GEOS-ME worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether GEOS-ME is currently mispriced by the market.
- Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.