Starhill Global Real Estate Investment Trust's (SGX:P40U) last week's 6.0% decline must have disappointed individual investors who have a significant stake

By
Simply Wall St
Published
November 30, 2021
SGX:P40U
Source: Shutterstock

If you want to know who really controls Starhill Global Real Estate Investment Trust (SGX:P40U), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 6.0% decline in share price, individual investors suffered the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Starhill Global Real Estate Investment Trust.

See our latest analysis for Starhill Global Real Estate Investment Trust

ownership-breakdown
SGX:P40U Ownership Breakdown December 1st 2021

What Does The Institutional Ownership Tell Us About Starhill Global Real Estate Investment Trust?

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.

We can see that Starhill Global Real Estate Investment Trust 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 Starhill Global Real Estate Investment Trust's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
SGX:P40U Earnings and Revenue Growth December 1st 2021

Starhill Global Real Estate Investment Trust is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Yeoh Tiong Lay & Sons Holdings Sdn. Bhd. with 25% of shares outstanding. AIA Investment Management Private Limited is the second largest shareholder owning 5.0% of common stock, and The Vanguard Group, Inc. holds about 2.4% of the company stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 Starhill Global Real Estate Investment Trust

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 less than 1% of Starhill Global Real Estate Investment Trust. However, it's possible that insiders might have an indirect interest through a more complex structure. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own S$94k worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 59% of Starhill Global Real Estate Investment Trust shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

It seems that Private Companies own 25%, of the Starhill Global Real Estate Investment Trust stock. 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:

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 - Starhill Global Real Estate Investment Trust has 2 warning signs (and 1 which can't be ignored) we think you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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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