Do Institutions Own Canyon Creek Food Company Ltd. (CVE:CYF) Shares?

By
Simply Wall St
Published
January 01, 2020
TSXV:CYF

The big shareholder groups in Canyon Creek Food Company Ltd. (CVE:CYF) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.

Canyon Creek Food is not a large company by global standards. It has a market capitalization of CA$527k, which means it wouldn't have the attention of many institutional investors. In the chart below, we can see that institutions are not on the share registry. Let's delve deeper into each type of owner, to discover more about Canyon Creek Food.

View 2 warning signs we detected for Canyon Creek Food

TSXV:CYF Ownership Summary, January 1st 2020
TSXV:CYF Ownership Summary, January 1st 2020

What Does The Lack Of Institutional Ownership Tell Us About Canyon Creek Food?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Canyon Creek Food might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

TSXV:CYF Income Statement, December 31st 2019
TSXV:CYF Income Statement, December 31st 2019

We note that hedge funds don't have a meaningful investment in Canyon Creek Food. The company's largest shareholder is Chemco Electrical Contractors Ltd., with ownership of 36%, The second and third largest shareholders are Brian Halina and Terence Alty, holding 18% and 2.3%, respectively. Terence Alty also happens to hold the title of Member of the Board of Directors.

Additionally, we found that 2 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.

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. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Canyon Creek Food

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.

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.

It seems insiders own a significant proportion of Canyon Creek Food Company Ltd.. Insiders own CA$117k worth of shares in the CA$527k company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, with a 40% stake in the company, will not easily be ignored. 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 38%, of the CYF 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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