Yahoo Finance 75% of Petrus Resources Ltd. (TSE:PRQ) is owned by insiders, and they've been buying recently
Key Insights
Petrus Resources' significant insider ownership suggests inherent interests in company's expansion
A total of 2 investors have a majority stake in the company with 50% ownership
If you want to know who really controls Petrus Resources Ltd. (TSE:PRQ), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 75% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
A quick look at our data suggests that insiders have been buying shares in the company recently. This could signal that stock prices could go up and insiders are here for it.
Let's take a closer look to see what the different types of shareholders can tell us about Petrus Resources.
View our latest analysis for Petrus Resources
What Does The Lack Of Institutional Ownership Tell Us About Petrus Resources?
Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.
There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Petrus Resources might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
We note that hedge funds don't have a meaningful investment in Petrus Resources. Donald Gray is currently the company's largest shareholder with 27% of shares outstanding. For context, the second largest shareholder holds about 23% of the shares outstanding, followed by an ownership of 21% by the third-largest shareholder. Additionally, the company's CEO Ken Gray directly holds 3.2% of the total shares outstanding.
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 50% 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. There is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Petrus Resources
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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 most recent data indicates that insiders own the majority of Petrus Resources Ltd.. This means they can collectively make decisions for the company. Given it has a market cap of CA$154m, that means they have CA$115m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.
General Public Ownership
With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Petrus Resources. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Petrus Resources , and understanding them should be part of your investment process.
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.
