In This Article:
Key Insights
-
Significant control over NEXTDC by individual investors implies that the general public has more power to influence management and governance-related decisions
-
41% of the business is held by the top 25 shareholders
If you want to know who really controls NEXTDC Limited (ASX:NXT), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 57% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Following a 4.6% decrease in the stock price last week, individual investors suffered the most losses, but institutions who own 43% stock also took a hit.
Let's delve deeper into each type of owner of NEXTDC, beginning with the chart below.
View our latest analysis for NEXTDC
What Does The Institutional Ownership Tell Us About NEXTDC?
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 NEXTDC. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 NEXTDC's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in NEXTDC. Our data shows that Australian Super Pty Ltd is the largest shareholder with 6.0% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.3% and 4.3% of the stock.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of NEXTDC
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.