Interesting article ............... Do Insiders Own Lots Of Shares In Murray Cod Australia Limited (ASX:MCA)?
By Simply Wall St
Published
August 05, 2021
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The big shareholder groups in Murray Cod Australia Limited (ASX:MCA) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.
Murray Cod Australia is not a large company by global standards. It has a market capitalization of AU$176m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholders can tell us about Murray Cod Australia.
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ASX:MCA Ownership Breakdown August 5th 2021 What Does The Institutional Ownership Tell Us About Murray Cod Australia?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
Murray Cod Australia already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Murray Cod Australia's earnings history below. Of course, the future is what really matters.
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ASX:MCA Earnings and Revenue Growth August 5th 2021
Hedge funds don't have many shares in Murray Cod Australia. The company's CEO Matthew Ryan is the largest shareholder with 16% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.3% and 5.6% of the stock. Interestingly, the third-largest shareholder, George Commins is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 23 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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 is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Murray Cod Australia
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own a reasonable proportion of Murray Cod Australia Limited. Insiders have a AU$59m stake in this AU$176m business. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.
Cheers .......
MCA Price at posting:
36.0¢ Sentiment: Buy Disclosure: Held
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