Do Institutions Own Argosy Property Limited (NZSE:ARG) Shares?

February 12, 2020
  •  Updated
October 03, 2022
NZSE:ARG
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A look at the shareholders of Argosy Property Limited (NZSE:ARG) can tell us which group is most powerful. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. Companies that have been privatized tend to have low insider ownership.

Argosy Property is not a large company by global standards. It has a market capitalization of NZ$1.2b, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about Argosy Property.

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NZSE:ARG Ownership Summary, February 13th 2020
NZSE:ARG Ownership Summary, February 13th 2020

What Does The Institutional Ownership Tell Us About Argosy Property?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Argosy Property does have institutional investors; and they hold 25% of the 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Argosy Property, (below). Of course, keep in mind that there are other factors to consider, too.

NZSE:ARG Income Statement, February 13th 2020
NZSE:ARG Income Statement, February 13th 2020

We note that hedge funds don't have a meaningful investment in Argosy Property. Our data shows that Accident Compensation Corporation, Asset Management Arm is the largest shareholder with 5.2% of shares outstanding. Next, we have The Vanguard Group, Inc. and Milford Funds Limited as the second and third largest shareholders, holding 5.1% and 2.0%, of the shares outstanding, respectively.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than 50% of the register, suggesting a large group of small holders where no one share holder has a majority.

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 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 Argosy Property

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.

We can see that insiders own shares in Argosy Property Limited. It has a market capitalization of just NZ$1.2b, and insiders have NZ$14m 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, mostly retail investors, hold a substantial 74% stake in ARG, suggesting it is a fairly popular stock. With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.

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. Take risks, for example - Argosy Property has 3 warning signs (and 1 which is a bit unpleasant) we think 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.

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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