City Lodge Hotels Limited (JSE:CLH) has caught the attention of institutional investors who hold a sizeable 42% stake
editorial-team@simplywallst.com (Simply Wall St)
5 min read
Key Insights
Institutions' substantial holdings in City Lodge Hotels implies that they have significant influence over the company's share price
A total of 7 investors have a majority stake in the company with 53% ownership
Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock
We've discovered 1 warning sign about City Lodge Hotels. View them for free.
To get a sense of who is truly in control of City Lodge Hotels Limited (JSE:CLH), it is important to understand the ownership structure of the business. We can see that institutions own the lion's share in the company with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
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. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence on its future.
In the chart below, we zoom in on the different ownership groups of City Lodge Hotels.
What Does The Institutional Ownership Tell Us About City Lodge Hotels?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
As you can see, institutional investors have a fair amount of stake in City Lodge Hotels. 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 City Lodge Hotels' historic earnings and revenue below, but keep in mind there's always more to the story.
JSE:CLH Earnings and Revenue Growth May 15th 2025
Our data indicates that hedge funds own 5.6% of City Lodge Hotels. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Allan Gray Proprietary Ltd. is currently the company's largest shareholder with 15% of shares outstanding. Enderle S.A. (Pty) Ltd is the second largest shareholder owning 9.7% of common stock, and Entertainment Holdings Pty Ltd holds about 8.9% of the company stock. Furthermore, CEO Andrew Widegger is the owner of 0.6% of the company's shares.
We also observed that the top 7 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.
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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of City Lodge Hotels
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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 City Lodge Hotels Limited insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. It seems the board members have no more than R22m worth of shares in the R2.3b company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.
General Public Ownership
The general public-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
It seems that Private Companies own 19%, of the City Lodge Hotels stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
Public Company Ownership
Public companies currently own 3.2% of City Lodge Hotels stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for City Lodge Hotels you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this freelist of interesting companies.
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.
