The ASX200 is up more than 1.3% to 7,777 in lunchtime trade, as the market enjoys its second consecutive day in the green. The Aussie bourse has been trading higher on the back of a rebounding Wall Street and better-than-expected US jobs data, lifting investor sentiment and easing recession fears. In such an optimistic market environment, growth companies with high insider ownership can be particularly appealing to investors. High insider ownership often signals confidence from those closest to the business and can align interests between management and shareholders.
Top 10 Growth Companies With High Insider Ownership In Australia
Overview: Aussie Broadband Limited, with a market cap of A$916.11 million, provides telecommunications services to residential and business customers in Australia.
Operations: The company generates revenue from four main segments: Business (A$94.21 million), Wholesale (A$125.25 million), Residential (A$549.59 million), and Enterprise and Government (A$85.85 million).
Insider Ownership: 10.8%
Aussie Broadband, a growth company with high insider ownership, is forecast to see significant earnings growth of 23.7% annually over the next three years, outpacing the broader Australian market. However, recent substantial insider selling and past shareholder dilution could be concerns for investors. Despite trading at 7.1% below its estimated fair value and pursuing strategic acquisitions like Superloop with a A$120 million equity raising, its Return on Equity is projected to remain low at 8.8%.
Overview: Capricorn Metals Ltd is an Australian company focused on the evaluation, exploration, development, and production of gold properties with a market cap of A$2.11 billion.
Operations: The company's revenue primarily comes from its Karlawinda gold property, generating A$356.94 million.
Insider Ownership: 12.3%
Capricorn Metals, with strong insider ownership, is trading at 57.9% below its estimated fair value. The company projects annual earnings growth of 27.05%, significantly outpacing the Australian market's 12.8%. Despite lower profit margins this year (5.2% vs last year's 25.4%), its Return on Equity is forecasted to reach a high of 32.5% in three years. Revenue growth at 13.6% per year is expected to surpass the broader market's rate of 5.1%.
Overview: Cedar Woods Properties Limited is an Australian company involved in property investment and development, with a market cap of A$403.03 million.
Operations: Cedar Woods Properties generates revenue primarily from its property development and investment segment, amounting to A$362.23 million.
Insider Ownership: 13.5%
Cedar Woods Properties, with notable insider ownership, is trading slightly below its fair value. The company's earnings are forecasted to grow significantly at 20% annually over the next three years, outpacing the Australian market's 12.8%. Despite lower profit margins this year (7% vs last year's 10.4%), revenue growth of 11.8% per year is expected to exceed the broader market's rate of 5.1%. Insider transactions have been minimal but positive recently.
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.The analysis only considers stock directly held by insiders. It does not include indirectly owned stock through other vehicles such as corporate and/or trust entities. All forecast revenue and earnings growth rates quoted are in terms of annualised (per annum) growth rates over 1-3 years.
Companies discussed in this article include ASX:ABB ASX:CMM and ASX:CWP.
