The recent 11% gain must have brightened Chief Investment Officer Philip King's week, Regal Partners Limited's (ASX:RPL) most bullish insider

Key Insights

• Significant insider control over Regal Partners implies vested interests in company growth
• A total of 2 investors have a majority stake in the company with 67% ownership
• Institutional ownership in Regal Partners is 11%

If you want to know who really controls Regal Partners Limited (ASX:RPL), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 61% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders scored the highest last week as the company hit AU$636m market cap following a 11% gain in the stock.

Let's delve deeper into each type of owner of Regal Partners, beginning with the chart below.

Check out our latest analysis for Regal Partners

What Does The Institutional Ownership Tell Us About Regal Partners?

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 Regal Partners does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Regal Partners' historic earnings and revenue below, but keep in mind there's always more to the story.

Regal Partners is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Regal Partners' case, its Chief Investment Officer, Philip King, is the largest shareholder, holding 35% of shares outstanding. Robert Luciano is the second largest shareholder owning 32% of common stock, and Regal Foundation., Endowment Arm holds about 9.0% of the company stock. Additionally, the company's CEO Brendan O’Connor directly holds 3.5% of the total shares outstanding.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Regal Partners

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Our information suggests that insiders own more than half of Regal Partners Limited. This gives them effective control of the company. Given it has a market cap of AU$636m, that means they have AU$385m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

With a 19% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Regal Partners. 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.

Private Company Ownership

Our data indicates that Private Companies hold 9.0%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 3 warning signs for Regal Partners (1 shouldn't be ignored!) that you should be aware of before investing here.

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.