Acrow Formwork and Construction Services Limited's (ASX:ACF) largest shareholders are retail investors with 55% ownership, institutions own 18%
Simply Wall St
5 min read
Key Insights
Acrow Formwork and Construction Services' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
If you want to know who really controls Acrow Formwork and Construction Services Limited (ASX:ACF), then you'll have to look at the makeup of its share registry. With 55% stake, retail investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And institutions on the other hand have a 18% ownership in the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.
Let's take a closer look to see what the different types of shareholders can tell us about Acrow Formwork and Construction Services.
What Does The Institutional Ownership Tell Us About Acrow Formwork and Construction Services?
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 Acrow Formwork and Construction Services. 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 Acrow Formwork and Construction Services' historic earnings and revenue below, but keep in mind there's always more to the story.
ASX:ACF Earnings and Revenue Growth May 18th 2023
Hedge funds don't have many shares in Acrow Formwork and Construction Services. Looking at our data, we can see that the largest shareholder is Perennial Value Management Limited with 8.0% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.9% and 4.6% of the stock. Additionally, the company's CEO Steven Boland directly holds 2.1% of the total shares outstanding.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Acrow Formwork and Construction Services
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 information suggests that insiders maintain a significant holding in Acrow Formwork and Construction Services Limited. It has a market capitalization of just AU$206m, and insiders have AU$27m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, mostly comprising of individual investors, collectively holds 55% of Acrow Formwork and Construction Services shares. 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.
Private Company Ownership
We can see that Private Companies own 15%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
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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