The big shareholder groups in MyFiziq Limited (ASX:MYQ) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.
With a market capitalization of AU$20m, MyFiziq is a small cap stock, so it might not be well known by many institutional investors. In the chart below below, we can see that institutions don't own many shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about MYQ.
See our latest analysis for MyFiziq
What Does The Institutional Ownership Tell Us About MyFiziq?
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.
Institutions own less than 5% of MyFiziq. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.
Hedge funds don't have many shares in MyFiziq. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of MyFiziq
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that insiders maintain a significant holding in MyFiziq Limited. Insiders have a AU$9.5m stake in this AU$20m business. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.