Hedge funds investors have a lot riding on Aldebaran Resources Inc. (CVE:ALDE) with 44% ownership
Key Insights
Institutions' substantial holdings in Aldebaran Resources implies that they have significant influence over the company's share price
61% of the business is held by the top 2 shareholders
A look at the shareholders of Aldebaran Resources Inc. (CVE:ALDE) can tell us which group is most powerful. With 44% stake, hedge funds possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
And things are looking up for hedge funds investors after the company gained CA$16m in market cap last week. One-year return to shareholders is currently 14% and last week’s gain was the icing on the cake.
Let's delve deeper into each type of owner of Aldebaran Resources, beginning with the chart below.
View our latest analysis for Aldebaran Resources
What Does The Lack Of Institutional Ownership Tell Us About Aldebaran Resources?
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Aldebaran Resources might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
It would appear that 44% of Aldebaran Resources shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Our data shows that Route One Investment Company, L.P. is the largest shareholder with 44% of shares outstanding. With 17% and 9.3% of the shares outstanding respectively, Sibanye Stillwater Limited and South32 Limited are the second and third largest shareholders. Furthermore, CEO John Black is the owner of 1.4% of the company's shares.
After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of Aldebaran Resources
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.
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 most recent data indicates that insiders own some shares in Aldebaran Resources Inc.. As individuals, the insiders collectively own CA$7.6m worth of the CA$134m company. This shows at least some alignment, but we usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 24% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Aldebaran Resources. 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.
Public Company Ownership
We can see that public companies hold 26% of the Aldebaran Resources shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Aldebaran Resources better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for Aldebaran Resources you should be aware of, and 3 of them are significant.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
