Advantage Energy Ltd. (TSE:AAV) surges 4.6%; individual investors who own 54% shares profited along with institutions
Key Insights
- Significant control over Advantage Energy by individual investors implies that the general public has more power to influence management and governance-related decisions
- The top 25 shareholders own 44% of the company
- Institutional ownership in Advantage Energy is 32%
If you want to know who really controls Advantage Energy Ltd. (TSE:AAV), 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 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Individual investors gained the most after market cap touched CA$2.1b last week, while institutions who own 32% also benefitted.
Let's delve deeper into each type of owner of Advantage Energy, beginning with the chart below.
See our latest analysis for Advantage Energy
What Does The Institutional Ownership Tell Us About Advantage Energy?
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.
We can see that Advantage Energy does have institutional investors; and they hold a good portion of the company's stock. 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 Advantage Energy's earnings history below. Of course, the future is what really matters.
It looks like hedge funds own 11% of Advantage Energy shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. The company's largest shareholder is EdgePoint Investment Group Inc., with ownership of 11%. In comparison, the second and third largest shareholders hold about 6.2% and 4.9% of the stock. Additionally, the company's CEO Michael Belenkie directly holds 0.7% of the total shares outstanding.
A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Advantage Energy
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.
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 Advantage Energy Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around CA$67m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a substantial 54% stake in Advantage Energy, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Advantage Energy better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Advantage Energy .
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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.