With 72% institutional ownership, Deep Yellow Limited (ASX:DYL) is a favorite amongst the big guns
In This Article:
Key Insights
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Given the large stake in the stock by institutions, Deep Yellow's stock price might be vulnerable to their trading decisions
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A total of 8 investors have a majority stake in the company with 52% ownership
To get a sense of who is truly in control of Deep Yellow Limited (ASX:DYL), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 72% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's delve deeper into each type of owner of Deep Yellow, beginning with the chart below.
View our latest analysis for Deep Yellow
What Does The Institutional Ownership Tell Us About Deep Yellow?
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.
Deep Yellow already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Deep Yellow's historic earnings and revenue below, but keep in mind there's always more to the story.
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. We note that hedge funds don't have a meaningful investment in Deep Yellow. The company's largest shareholder is State Street Global Advisors, Inc., with ownership of 8.3%. The second and third largest shareholders are Sprott Inc. and ALPS Advisors, Inc., with an equal amount of shares to their name at 7.8%. In addition, we found that John Borshoff, the CEO has 1.8% of the shares allocated to their name.
We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.