CEO Seng Tham, Alps Group Inc's (NASDAQ:ALPS) largest shareholder sees value of holdings go down 12% after recent drop
Key Insights
- Alps Group's significant insider ownership suggests inherent interests in company's expansion
- The top 2 shareholders own 57% of the company
- Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
Every investor in Alps Group Inc (NASDAQ:ALPS) should be aware of the most powerful shareholder groups. With 57% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And following last week's 12% decline in share price, insiders suffered the most losses.
In the chart below, we zoom in on the different ownership groups of Alps Group.
See our latest analysis for Alps Group
What Does The Lack Of Institutional Ownership Tell Us About Alps Group?
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Alps Group's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
We note that hedge funds don't have a meaningful investment in Alps Group. With a 46% stake, CEO Seng Tham is the largest shareholder. For context, the second largest shareholder holds about 10% of the shares outstanding, followed by an ownership of 9.5% by the third-largest shareholder.
A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 57% stake.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Alps Group
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.
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.
Our information suggests that insiders own more than half of Alps Group Inc. This gives them effective control of the company. So they have a US$97m stake in this US$171m business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Alps Group. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Private Company Ownership
It seems that Private Companies own 9.5%, of the Alps Group stock. 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:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 5 warning signs with Alps Group (at least 4 which make us uncomfortable) , and understanding them should be part of your investment process.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.
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.