What you need to know about the investor composition of Mach7 Technologies Limited (ASX:M7T)

If you want to know who actually controls Mach7 Technologies Limited (ASX:M7T), then you’ll need to look at the makeup of their share registry. Institutions often own shares in more established companies, while it is not uncommon to see insiders owning a good number of smaller companies. I like to see at least a little insider ownership. As Charlie Munger said “Show me the incentive and I’ll show you the result”.

Mach7 Technologies is not a big company by world standards. It has a market capitalization of A$170 million, which means it wouldn’t get the attention of many institutional investors. Looking at our ownership group data (below), it appears that institutions are visible on the share register. Let’s dig deeper into each owner type, to learn more about Mach7 Technologies.

Check out our latest analysis for Mach7 Technologies

distribution of property

What does institutional ownership tell us about Mach7 technologies?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.

As you can see, institutional investors hold a sizeable share of Mach7 Technologies. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. It is not uncommon to see a sharp decline in the stock price if two large institutional investors attempt to sell a stock at the same time. So it’s worth checking Mach7 Technologies’ past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.

earnings-and-revenue-growth

earnings-and-revenue-growth

Hedge funds don’t have a lot of shares in Mach7 Technologies. The company’s largest shareholder is Pt Dwi Satrya Utama, Asset Management Arm, with a 1.8% stake. For context, the second shareholder owns approximately 1.7% of the outstanding shares, followed by a 1.6% ownership by the third shareholder.

Looking at our ownership data, we found that 15 of the major shareholders collectively own less than 50% of the share register, implying that no single individual holds a majority stake.

While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand a stock’s expected performance. There is a little analyst coverage of the stock, but not much. So there is room for him to gain coverage.

Property of Mach7 Technologies Insiders

The definition of an insider may differ slightly from country to country, but board members still matter. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.

Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.

We may report that insiders hold shares in Mach7 Technologies Limited. As individuals, insiders collectively hold A$9.5 million worth of the A$170 million company. Some would say this shows the alignment of interests between shareholders and the board, although we generally prefer to see larger insider participations. But it might be worth checking to see if these insiders have sold.

General public property

The general public, made up mostly of individual investors, collectively owns 53% of the shares of Mach7 Technologies. This level of ownership gives mainstream investors some power to influence key policy decisions such as board composition, executive compensation, and dividend payout ratio.

Private Company Ownership

It appears that private companies own 3.8% of Mach7 Technologies stock. It’s hard to draw conclusions from this fact alone, so it’s worth investigating who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.

Next steps:

It is always useful to think about the different groups that own shares in a company. But to better understand Mach7 Technologies, we need to consider many other factors.

I like to dive deeper on the performance of a company in the past. You can find Earnings and Earnings History in this detailed graph.

If you’re like me, you might want to ask yourself if this business will grow or shrink. Luckily, you can check out this free report showing analyst predictions for its future.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.

Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

Comments are closed.