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A look at the shareholders of Brooks Laboratories Limited (NSE:BROOKS) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.'
With a market capitalization of ₹539m, Brooks Laboratories is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about BROOKS.
Check out our latest analysis for Brooks Laboratories
What Does The Institutional Ownership Tell Us About Brooks Laboratories?
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.
Brooks Laboratories already has institutions on the share registry. Indeed, they own 5.2% of the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Brooks Laboratories, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Brooks Laboratories. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Brooks Laboratories
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. 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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
It seems that insiders own more than half the Brooks Laboratories Limited stock. This gives them a lot of power. So they have a ₹381m stake in this ₹539m business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.