Significant control over Michael Hill International by private companies implies that the general public has more power to influence management and governance-related decisions
To get a sense of who is truly in control of Michael Hill International Limited (ASX:MHJ), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 39% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Individual investors, on the other hand, account for 29% of the company's stockholders.
Let's delve deeper into each type of owner of Michael Hill International, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Michael Hill International?
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.
As you can see, institutional investors have a fair amount of stake in Michael Hill International. 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. 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 Michael Hill International's historic earnings and revenue below, but keep in mind there's always more to the story.
ASX:MHJ Earnings and Revenue Growth February 5th 2025
Michael Hill International is not owned by hedge funds. Our data shows that Hoglett Hamlet Limited is the largest shareholder with 39% of shares outstanding. For context, the second largest shareholder holds about 13% of the shares outstanding, followed by an ownership of 5.0% by the third-largest shareholder. Furthermore, CEO Daniel Bracken is the owner of 0.7% of the company's shares.
To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Michael Hill International
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 insiders maintain a significant holding in Michael Hill International Limited. Insiders have a AU$21m stake in this AU$187m business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. 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 Company Ownership
It seems that Private Companies own 39%, of the Michael Hill International stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Michael Hill International better, we need to consider many other factors.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this freereport on analyst forecasts.
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.
