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If you want to know who really controls Z Energy Limited (NZSE:ZEL), then you’ll have to look at the makeup of its share registry. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. We also tend to see lower insider ownership in companies that were previously publicly owned.
With a market capitalization of NZ$2.4b, Z Energy is a decent size, so it is probably on the radar of institutional investors. In the chart below below, we can see that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about ZEL.
View our latest analysis for Z Energy
What Does The Institutional Ownership Tell Us About Z Energy?
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
We can see that Z Energy does have institutional investors; and they hold 63% 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It’s therefore worth looking at Z Energy’s earnings history, below. Of course, the future is what really matters.
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. We note that hedge funds don’t have a meaningful investment in Z Energy. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Z Energy
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
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.
Our information suggests that Z Energy Limited insiders own under 1% of the company. 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$4.8m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.