Institutions along with individual investors who hold considerable shares inJervois Global Limited (ASX:JRV) come under pressure; lose 10% of holdings value

By
Simply Wall St
Published
May 14, 2022
ASX:JRV
Source: Shutterstock

A look at the shareholders of Jervois Global Limited (ASX:JRV) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual investors with 41% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 10% decrease in the stock price last week, individual investors suffered the most losses, but institutions who own 30% stock also took a hit.

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

Check out our latest analysis for Jervois Global

ownership-breakdown
ASX:JRV Ownership Breakdown May 14th 2022

What Does The Institutional Ownership Tell Us About Jervois Global?

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 Jervois Global 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Jervois Global's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
ASX:JRV Earnings and Revenue Growth May 14th 2022

Jervois Global is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is AustralianSuper Pty. Ltd. with 18% of shares outstanding. Canadian Register Control is the second largest shareholder owning 8.4% of common stock, and Freeport-McMoRan Inc. holds about 7.0% of the company stock.

On further inspection, we found that more than half the company's shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Jervois Global

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our most recent data indicates that insiders own some shares in Jervois Global Limited. It has a market capitalization of just AU$1.2b, and insiders have AU$44m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 41% stake in Jervois Global. 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 18%, of the shares on issue. 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.

Public Company Ownership

Public companies currently own 7.0% of Jervois Global stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 3 warning signs for Jervois Global you should be aware of, and 2 of them make us uncomfortable.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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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