A look at the shareholders of Aussie Broadband Limited (ASX:ABB) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

Aussie Broadband isn't enormous, but it's not particularly small either. It has a market capitalization of AU$1.2b, which means it would generally expect to see some institutions on the share registry. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about Aussie Broadband.

Check out our latest analysis for Aussie Broadband  ownership-breakdown

What Does The Institutional Ownership Tell Us About Aussie Broadband?

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.

Aussie Broadband already has institutions on the share registry. Indeed, they own a respectable stake in 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Aussie Broadband, (below). Of course, keep in mind that there are other factors to consider, too. earnings-and-revenue-growth

Aussie Broadband is not owned by hedge funds. Intertubes Pty Ltd is currently the company's largest shareholder with 8.2% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.2% and 6.1%, of the shares outstanding, respectively. Phillip Britt, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.



A closer look at our ownership figures suggests that the top 11 shareholders have a combined ownership of 52% implying that no single shareholder has a majority.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Aussie Broadband

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

It seems insiders own a significant proportion of Aussie Broadband Limited. Insiders own AU$120m worth of shares in the AU$1.2b company. This may suggest that the founders still own a lot of shares. You can  click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 41% stake in Aussie Broadband. 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

We can see that Private Companies own 24%, of the shares on issue. 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. For instance, we've identified  2 warning signs for Aussie Broadband that you should be aware of.

Ultimately the future is most important. You can access this freereport on analyst forecasts for the company.

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.

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.

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