Significant control over Larvotto Resources by retail investors implies that the general public has more power to influence management and governance-related decisions
A total of 5 investors have a majority stake in the company with 51% ownership
If you want to know who really controls Larvotto Resources Limited (ASX:LRV), 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 retail investors with 33% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
As a result, retail investors collectively scored the highest last week as the company hit AU$161m market cap following a 28% gain in the stock.
Let's take a closer look to see what the different types of shareholders can tell us about Larvotto Resources.
What Does The Institutional Ownership Tell Us About Larvotto Resources?
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.
Larvotto Resources 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 Larvotto Resources' earnings history below. Of course, the future is what really matters.
ASX:LRV Earnings and Revenue Growth October 21st 2024
We note that hedge funds don't have a meaningful investment in Larvotto Resources. Our data shows that GAGE Capital Management Co. Ltd is the largest shareholder with 22% of shares outstanding. Beijing Gage Management Co., Ltd. is the second largest shareholder owning 14% of common stock, and 1832 Asset Management L.P. holds about 6.7% of the company stock. Furthermore, CEO Ronald Heeks is the owner of 2.0% of the company's shares.
To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Larvotto Resources
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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
We can see that insiders own shares in Larvotto Resources Limited. In their own names, insiders own AU$15m worth of stock in the AU$161m company. This shows at least some alignment, but we usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Larvotto Resources. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Equity Ownership
Private equity firms hold a 14% stake in Larvotto Resources. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.
Private Company Ownership
We can see that Private Companies own 31%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 4 warning signs for Larvotto Resources you should know about.
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.
