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If you want to know who really controls Lifestyle Communities Limited (ASX:LIC), then you'll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.
With a market capitalization of AU$791m, Lifestyle Communities is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholder can tell us about LIC.
View our latest analysis for Lifestyle Communities
What Does The Institutional Ownership Tell Us About Lifestyle Communities?
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.
We can see that Lifestyle Communities does have institutional investors; and they hold 43% of the stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Lifestyle Communities, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Lifestyle Communities. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Lifestyle Communities
The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
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.
It seems insiders own a significant proportion of Lifestyle Communities Limited. Insiders own AU$101m worth of shares in the AU$791m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.