Private companies are Macmahon Holdings Limited's (ASX:MAH) biggest owners and were rewarded after market cap rose by AU$32m last week

Key Insights

• The considerable ownership by private companies in Macmahon Holdings indicates that they collectively have a greater say in management and business strategy
• The top 2 shareholders own 53% of the company
• Institutions own 15% of Macmahon Holdings

To get a sense of who is truly in control of Macmahon Holdings Limited (ASX:MAH), it is important to understand the ownership structure of the business. We can see that private companies own the lion's share in the company with 49% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, private companies benefitted the most after the company's market cap rose by AU$32m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Macmahon Holdings.

Check out our latest analysis for Macmahon Holdings

What Does The Institutional Ownership Tell Us About Macmahon Holdings?

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.

As you can see, institutional investors have a fair amount of stake in Macmahon Holdings. 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 Macmahon Holdings' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Macmahon Holdings. Amman Mineral Contractors (Singapore) Pte. Ltd. is currently the company's largest shareholder with 45% of shares outstanding. With 7.2% and 5.1% of the shares outstanding respectively, Paradice Investment Management Pty Ltd. and United Super Pty Ltd are the second and third largest shareholders.

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.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Macmahon Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

We can report that insiders do own shares in Macmahon Holdings Limited. It has a market capitalization of just AU$326m, and insiders have AU$7.0m 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

With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Macmahon Holdings. 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

It seems that Private Companies own 49%, of the Macmahon Holdings stock. 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:

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. Be aware that Macmahon Holdings is showing 1 warning sign in our investment analysis , 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.