Individual investors own 42% of Genesis Energy Limited (NZSE:GNE) shares but state or government control 51% of the company

Simply Wall St

Wed, May 24, 2023, 7:30 PM 4 min read

The considerable ownership by state or government in Genesis Energy indicates that they collectively have a greater say in management and business strategy
New Zealand Government owns 51% of the company
Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

A look at the shareholders of Genesis Energy Limited (NZSE:GNE) can tell us which group is most powerful. With 51% stake, state or government possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Meanwhile, individual investors make up 42% of the company’s shareholders.

Let's delve deeper into each type of owner of Genesis Energy, beginning with the chart below.

Check out our latest analysis for Genesis Energy

ownership-breakdown — NZSE:GNE Ownership Breakdown May 25th 2023

What Does The Institutional Ownership Tell Us About Genesis Energy?

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.

Genesis Energy already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Genesis Energy, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth — NZSE:GNE Earnings and Revenue Growth May 25th 2023

Hedge funds don't have many shares in Genesis Energy. New Zealand Government is currently the largest shareholder, with 51% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. With 1.6% and 1.6% of the shares outstanding respectively, The Vanguard Group, Inc. and Accident Compensation Corporation, Asset Management Arm are the second and third largest shareholders.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Genesis Energy

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.

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 most recent data indicates that insiders own less than 1% of Genesis Energy Limited. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own NZ$11m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 42% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Genesis Energy. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Genesis Energy better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Genesis Energy (including 1 which can't be ignored) .

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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