Stock Analysis

Do Institutions Own High Liner Foods Incorporated (TSE:HLF) Shares?

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TSX:HLF
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A look at the shareholders of High Liner Foods Incorporated (TSE:HLF) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. We also tend to see lower insider ownership in companies that were previously publicly owned.

High Liner Foods is not a large company by global standards. It has a market capitalization of CA$370m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about High Liner Foods.

Check out our latest analysis for High Liner Foods

ownership-breakdown
TSX:HLF Ownership Breakdown December 14th 2020

What Does The Institutional Ownership Tell Us About High Liner Foods?

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.

We can see that High Liner Foods does have institutional investors; and they hold a good portion of the company's stock. 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. 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 High Liner Foods' historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
TSX:HLF Earnings and Revenue Growth December 14th 2020

High Liner Foods is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Thornridge Holdings Limited with 35% of shares outstanding. Letko, Brosseau & Associates Inc. is the second largest shareholder owning 10.0% of common stock, and Dimensional Fund Advisors L.P. holds about 1.7% of the company stock.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of High Liner Foods

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.

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 High Liner Foods Incorporated. It has a market capitalization of just CA$370m, and insiders have CA$10m worth of shares, in their own names. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public holds a 45% stake in High Liner Foods. 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

We can see that Private Companies own 35%, 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:

It's always worth thinking about the different groups who own shares in a company. But to understand High Liner Foods better, we need to consider many other factors. For example, we've discovered 3 warning signs for High Liner Foods (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

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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