Private equity firms who hold 53% of Granite Ridge Resources, Inc. (NYSE:GRNT) gained 8.1%, institutions profited as well

Key Insights

• The considerable ownership by private equity firms in Granite Ridge Resources indicates that they collectively have a greater say in management and business strategy
• 53% of the business is held by the top 2 shareholders
• Recent purchases by insiders

To get a sense of who is truly in control of Granite Ridge Resources, Inc. (NYSE:GRNT), it is important to understand the ownership structure of the business. We can see that private equity firms own the lion's share in the company with 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While private equity firms were the group that benefitted the most from last week’s US$65m market cap gain, institutions too had a 27% share in those profits.

Let's take a closer look to see what the different types of shareholders can tell us about Granite Ridge Resources.

See our latest analysis for Granite Ridge Resources

What Does The Institutional Ownership Tell Us About Granite Ridge Resources?

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 Granite Ridge Resources does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Granite Ridge Resources' earnings history below. Of course, the future is what really matters.

Granite Ridge Resources is not owned by hedge funds. Grey Rock Energy Management, LLC is currently the company's largest shareholder with 47% of shares outstanding. Hamilton Lane Incorporated is the second largest shareholder owning 6.1% of common stock, and Utah Retirement Systems holds about 4.0% of the company stock.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 53% stake.

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

Insider Ownership Of Granite Ridge Resources

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.

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.

Shareholders would probably be interested to learn that insiders own shares in Granite Ridge Resources, Inc.. It has a market capitalization of just US$872m, and insiders have US$27m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Granite Ridge Resources. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

Private equity firms hold a 53% stake in Granite Ridge Resources. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Granite Ridge Resources better, we need to consider many other factors. For instance, we've identified 3 warning signs for Granite Ridge Resources (1 is a bit concerning) that you should be aware of.

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.

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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.