Anglo American Platinum Limited's (JSE:AMS) market cap surged R26b last week, public companies who have a lot riding on the company were rewarded

Key Insights

• Significant control over Anglo American Platinum by public companies implies that the general public has more power to influence management and governance-related decisions
• Anglo American plc owns 79% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

Every investor in Anglo American Platinum Limited (JSE:AMS) should be aware of the most powerful shareholder groups. With 79% stake, public companies possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies collectively scored the highest last week as the company hit R193b market cap following a 16% gain in the stock.

Let's delve deeper into each type of owner of Anglo American Platinum, beginning with the chart below.

View our latest analysis for Anglo American Platinum

What Does The Institutional Ownership Tell Us About Anglo American Platinum?

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 Anglo American Platinum. 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 Anglo American Platinum's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Anglo American Platinum. Anglo American plc is currently the largest shareholder, with 79% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. For context, the second largest shareholder holds about 0.9% of the shares outstanding, followed by an ownership of 0.9% by the third-largest shareholder.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Anglo American Platinum

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Our data suggests that insiders own under 1% of Anglo American Platinum Limited in their own names. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own R3.0m of stock. In this sort of situation, it can be more interesting to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 14% stake in Anglo American Platinum. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Public Company Ownership

Public companies currently own 79% of Anglo American Platinum stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Anglo American Platinum better, we need to consider many other factors. For example, we've discovered 2 warning signs for Anglo American Platinum (1 is a bit unpleasant!) that you should be aware of before investing here.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.