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Can We See Significant Insider Ownership On The Gateley (Holdings) Plc (LON:GTLY) Share Register?

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Every investor in Gateley (Holdings) Plc (LON:GTLY) should be aware of the most powerful shareholder groups. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. 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.'

Gateley (Holdings) is not a large company by global standards. It has a market capitalization of UK£177m, which means it wouldn't have the attention of many institutional investors. In the chart below below, we can see that institutions own shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about GTLY.

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View our latest analysis for Gateley (Holdings)

AIM:GTLY Ownership Summary, May 15th 2019
AIM:GTLY Ownership Summary, May 15th 2019

What Does The Institutional Ownership Tell Us About Gateley (Holdings)?

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.

Gateley (Holdings) already has institutions on the share registry. Indeed, they own 39% of 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Gateley (Holdings)'s historic earnings and revenue, below, but keep in mind there's always more to the story.

AIM:GTLY Income Statement, May 15th 2019
AIM:GTLY Income Statement, May 15th 2019

We note that hedge funds don't have a meaningful investment in Gateley (Holdings). Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Gateley (Holdings)

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.

Shareholders would probably be interested to learn that insiders own shares in Gateley (Holdings) Plc. In their own names, insiders own UK£17m worth of stock in the UK£177m company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public -- mostly retail investors -- own 50% of Gateley (Holdings) . With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Gateley (Holdings) better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free .

Ultimately the future is most important. You can access this free report 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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.