Hipages Group Holdings Limited's (ASX:HPG) market cap touched AU$156m last week, benefiting both public companies who own 28% as well as institutions

Key Insights

• Significant control over Hipages Group Holdings by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 4 shareholders own 50% of the company
• Institutional ownership in Hipages Group Holdings is 28%

Every investor in Hipages Group Holdings Limited (ASX:HPG) should be aware of the most powerful shareholder groups. With 28% stake, public 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 12% increase in the stock price last week, public companies profited the most, but institutions who own 28% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of Hipages Group Holdings, beginning with the chart below.

View our latest analysis for Hipages Group Holdings

What Does The Institutional Ownership Tell Us About Hipages Group Holdings?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Hipages Group Holdings already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Hipages Group Holdings' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Hipages Group Holdings. Our data shows that News Corporation is the largest shareholder with 28% of shares outstanding. Ellerston Capital Limited is the second largest shareholder owning 10% of common stock, and Rsz Pty Ltd holds about 6.0% of the company stock.

On looking further, we found that 50% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 Hipages Group Holdings

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 less than 1% of Hipages Group Holdings Limited. But they may have an indirect interest through a corporate structure that we haven't picked up on. It appears that the board holds about AU$1.5m worth of stock. This compares to a market capitalization of AU$156m. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

With a 26% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hipages Group Holdings. 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

It seems that Private Companies own 16%, of the Hipages Group Holdings stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

Public companies currently own 28% of Hipages Group Holdings stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Hipages Group Holdings has 1 warning sign we think you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.