In This Article:
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
The big shareholder groups in SKYCITY Entertainment Group Limited (NZSE:SKC) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Companies that used to be publicly owned tend to have lower insider ownership.
SKYCITY Entertainment Group has a market capitalization of NZ$2.5b, so we would expect some institutional investors to have noticed the stock. In the chart below below, we can see that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholder can tell us about SKC.
Check out our latest analysis for SKYCITY Entertainment Group
What Does The Institutional Ownership Tell Us About SKYCITY Entertainment Group?
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.
SKYCITY Entertainment Group already has institutions on the share registry. Indeed, they own 61% 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see SKYCITY Entertainment Group's historic earnings and revenue, below, but keep in mind there's always more to the story.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. We note that hedge funds don't have a meaningful investment in SKYCITY Entertainment Group. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of SKYCITY Entertainment Group
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.