Yahoo Finance Individual investors account for 60% of Northland Power Inc.'s (TSE:NPI) ownership, while institutions account for 39%
Key Insights
Northland Power's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
32% of the business is held by the top 25 shareholders
If you want to know who really controls Northland Power Inc. (TSE:NPI), 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 investors with 60% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And institutions on the other hand have a 39% ownership in the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.
Let's delve deeper into each type of owner of Northland Power, beginning with the chart below.
Check out our latest analysis for Northland Power
What Does The Institutional Ownership Tell Us About Northland Power?
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 Northland Power. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Northland Power, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Northland Power. Our data shows that BlackRock, Inc. is the largest shareholder with 4.6% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.0% and 3.4% of the stock.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Northland Power
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.
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 information suggests that Northland Power Inc. insiders own under 1% of the company. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own CA$13m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General Public Ownership
The general public -- including retail investors -- own 60% of Northland Power. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
Next Steps:
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. Be aware that Northland Power is showing 4 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...
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.
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