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- NasdaqGS:KLXE
KLX Energy Services Holdings, Inc.'s (NASDAQ:KLXE) 10% loss last week hit both individual investors who own 40% as well as institutions
Key Insights
- The considerable ownership by retail investors in KLX Energy Services Holdings indicates that they collectively have a greater say in management and business strategy
- A total of 17 investors have a majority stake in the company with 50% ownership
- 30% of KLX Energy Services Holdings is held by Institutions
A look at the shareholders of KLX Energy Services Holdings, Inc. (NASDAQ:KLXE) can tell us which group is most powerful. With 40% stake, retail investors 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).
While institutions, who own 30% shares weren’t spared from last week’s US$17m market cap drop, retail investors as a group suffered the maximum losses
In the chart below, we zoom in on the different ownership groups of KLX Energy Services Holdings.
Check out our latest analysis for KLX Energy Services Holdings
What Does The Institutional Ownership Tell Us About KLX Energy Services Holdings?
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 KLX Energy Services Holdings 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. 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 KLX Energy Services Holdings' earnings history below. Of course, the future is what really matters.
It looks like hedge funds own 9.2% of KLX Energy Services Holdings shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Denham Capital Management LP is currently the largest shareholder, with 13% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.2% and 4.7% of the stock. Additionally, the company's CEO Christopher Baker directly holds 0.8% of the total shares outstanding.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 17 shareholders, meaning that no single shareholder has a majority interest in the ownership.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of KLX Energy Services Holdings
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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.
Shareholders would probably be interested to learn that insiders own shares in KLX Energy Services Holdings, Inc.. It has a market capitalization of just US$150m, and insiders have US$4.8m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, who are usually individual investors, hold a 40% stake in KLX Energy Services Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Equity Ownership
Private equity firms hold a 13% stake in KLX Energy Services Holdings. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
Public Company Ownership
Public companies currently own 4.7% of KLX Energy Services Holdings stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for KLX Energy Services Holdings (1 can't be ignored) that you should be aware of.
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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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.
About NasdaqGS:KLXE
KLX Energy Services Holdings
Provides drilling, completions, production, and well intervention services and products to the onshore oil and gas producing regions of the United States.
Undervalued slight.