Significant control over Keyera by individual investors implies that the general public has more power to influence management and governance-related decisions
A total of 25 investors have a majority stake in the company with 35% ownership
If you want to know who really controls Keyera Corp. (TSE:KEY), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 57% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Following a 3.5% increase in the stock price last week, individual investors profited the most, but institutions who own 43% stock also stood to gain from the increase.
Let's delve deeper into each type of owner of Keyera, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Keyera?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
Keyera already has institutions on the share registry. Indeed, they own a respectable stake in 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. 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 Keyera's earnings history below. Of course, the future is what really matters.
TSX:KEY Earnings and Revenue Growth October 5th 2024
We note that hedge funds don't have a meaningful investment in Keyera. The company's largest shareholder is RBC Global Asset Management Inc., with ownership of 6.8%. M&G Investment Management Limited is the second largest shareholder owning 4.8% of common stock, and The Vanguard Group, Inc. holds about 3.9% of the company stock.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Keyera
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.
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 Keyera Corp. 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 CA$45m 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.
General Public Ownership
The general public, mostly comprising of individual investors, collectively holds 57% of Keyera shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Keyera , and understanding them should be part of your investment process.
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.
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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.
