Every investor in NI Holdings, Inc. (NASDAQ:NODK) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 60% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
While private companies were the group that benefitted the most from last week’s US$36m market cap gain, institutions too had a 24% share in those profits.
Let's delve deeper into each type of owner of NI Holdings, beginning with the chart below.
What Does The Institutional Ownership Tell Us About NI 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.
As you can see, institutional investors have a fair amount of stake in NI Holdings. 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 NI Holdings' earnings history below. Of course, the future is what really matters.
NI Holdings is not owned by hedge funds. Our data shows that Nodak Mutual Group, Inc. is the largest shareholder with 60% of shares outstanding. This implies that they have majority interest control of the future of the company. Jeffrey Thorp is the second largest shareholder owning 5.2% of common stock, and The TCW Group, Inc. holds about 3.1% of the company stock. Additionally, the company's CEO Michael Alexander directly holds 0.5% of the total shares outstanding.
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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of NI 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. 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.
We can report that insiders do own shares in NI Holdings, Inc.. It has a market capitalization of just US$366m, and insiders have US$23m 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 10% ownership, the general public, mostly comprising of individual investors, have some degree of sway over NI Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
We can see that Private Companies own 60%, of the shares on issue. 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.
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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for NI Holdings you should know about.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
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.