If you want to know who really controls Phosphagenics Limited (ASX:POH), then you’ll have to look at the makeup of its share registry. Institutions often own shares in more established companies, while it’s not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes ‘a business with enduring competitive advantages that is run by able and owner-oriented people’. So it’s nice to see some insider ownership, because it may suggest that management is owner-oriented.

Phosphagenics is a smaller company with a market capitalization of AU$36.3m, so it may still be flying under the radar of many institutional investors. In the chart below below, we can see that institutional investors have bought into the company. Let’s delve deeper into each type of owner, to discover more about POH.

See our latest analysis for Phosphagenics

What Does The Institutional Ownership Tell Us About Phosphagenics?

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 Phosphagenics does have institutional investors; and they hold 7.2% of the stock. 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. 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 Phosphagenics’s earnings history, below. Of course, the future is what really matters.

We note that hedge funds don’t have a meaningful investment in Phosphagenics. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Phosphagenics

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.

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 a reasonable proportion of Phosphagenics Limited. Insiders have a AU$4.6m stake in this AU$36.3m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.