Private companies who hold 47% of Smart Parking Limited (ASX:SPZ) gained 25%, institutions profited as well

Key Insights

• Significant control over Smart Parking by private companies implies that the general public has more power to influence management and governance-related decisions
• A total of 3 investors have a majority stake in the company with 60% ownership
• Institutions own 32% of Smart Parking

If you want to know who really controls Smart Parking Limited (ASX:SPZ), then you'll have to look at the makeup of its share registry. With 47% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 25% increase in the stock price last week, private companies profited the most, but institutions who own 32% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of Smart Parking.

See our latest analysis for Smart Parking

What Does The Institutional Ownership Tell Us About Smart Parking?

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 Smart Parking does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Smart Parking, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Smart Parking. Looking at our data, we can see that the largest shareholder is Finico Pty. Ltd. with 29% of shares outstanding. For context, the second largest shareholder holds about 17% of the shares outstanding, followed by an ownership of 15% by the third-largest shareholder. Furthermore, CEO Paul Gillespie is the owner of 1.2% of the company's shares.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 60% 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Smart Parking

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own some shares in Smart Parking Limited. As individuals, the insiders collectively own AU$11m worth of the AU$312m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Smart Parking. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 47%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Smart Parking you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.