Yahoo Finance While individual investors own 29% of Lesaka Technologies, Inc. (NASDAQ:LSAK), private equity firms are its largest shareholders with 40% ownership
Key Insights
The considerable ownership by private equity firms in Lesaka Technologies indicates that they collectively have a greater say in management and business strategy
The top 4 shareholders own 57% of the company
If you want to know who really controls Lesaka Technologies, Inc. (NASDAQ:LSAK), 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 private equity firms with 40% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Meanwhile, individual investors make up 29% of the company’s shareholders.
Let's take a closer look to see what the different types of shareholders can tell us about Lesaka Technologies.
Check out our latest analysis for Lesaka Technologies
What Does The Institutional Ownership Tell Us About Lesaka Technologies?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
As you can see, institutional investors have a fair amount of stake in Lesaka Technologies. 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. 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 Lesaka Technologies' historic earnings and revenue below, but keep in mind there's always more to the story.
Lesaka Technologies is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Value Capital Partners with 27% of shares outstanding. In comparison, the second and third largest shareholders hold about 13% and 8.9% of the stock. Furthermore, CEO Christopher Meyer is the owner of 1.4% of the company's shares.
To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Lesaka Technologies
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.
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.
Shareholders would probably be interested to learn that insiders own shares in Lesaka Technologies, Inc.. In their own names, insiders own US$7.4m worth of stock in the US$199m company. This shows at least some alignment, but we usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 29% stake in Lesaka Technologies. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Equity Ownership
Private equity firms hold a 40% stake in Lesaka Technologies. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.
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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Lesaka Technologies (at least 1 which is potentially serious) , and understanding them should be part of your investment process.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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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