Curro Holdings Limited (JSE:COH) share price fell 10% last week; public companies would not be happy

Every investor in Curro Holdings Limited (JSE:COH) should know the most powerful shareholder groups. The group with the largest number of shares in the company, around 60% to be precise, are the public companies. That is, the group will benefit the most if the stock goes up (or lose the most if there is a downturn).

As a result, public companies as a group suffered the highest losses last week after the market capitalization fell by R670 million.

In the table below, we zoom in on the different ownership groups of Curro Holdings.

However, if you prefer to see where opportunities and risks are within the COH industryyou can check out our analysis on the consumer services sector XX.

JSE:COH Ownership Breakdown September 14, 2022

What does institutional ownership tell us about Curro 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.

Curro Holdings already has institutions on the stock register. Indeed, they hold a respectable stake in the company. This implies that analysts working for these institutions have reviewed the stock and like it. But like everyone else, they can be wrong. 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 out Curro Holdings’ past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.

JSE:COH Earnings and Revenue Growth September 14, 2022

Hedge funds don’t have a lot of shares in Curro Holdings. PSG Group Ltd is currently the largest shareholder, with 60% of the outstanding shares. With such a stake in ownership, we infer that they have significant control over the future of the business. For context, the second shareholder owns approximately 5.4% of the outstanding shares, followed by a 1.9% stake by the third shareholder.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. As far as we can tell, there’s no analyst coverage of the company, so it’s probably flying under the radar.

Insider ownership of Curro Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.

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.

Our most recent data indicates that insiders hold shares of Curro Holdings Limited. As individuals, the insiders collectively own R87 million worth of the R5.8b company. Some would say this shows the alignment of interests between shareholders and the board. But it might be worth checking to see if these insiders have sold.

General public property

The general public, including retail investors, owns 26% of the company’s capital and therefore cannot be easily ignored. While that size of ownership might not be enough to sway a policy decision in their favor, they can still have a collective impact on company policies.

Ownership of a public company

Public companies currently own 60% of the shares of Curro Holdings. We cannot be sure, but it is quite possible that it is a strategic issue. Businesses can be similar or work together.

Next steps:

It is always useful to think about the different groups that own shares in a company. But to better understand Curro Holdings, we need to consider many other factors. To do this, you need to find out about the 2 warning signs we spotted with Curro Holdings (including 1 that is significant).

Sure, you might find a fantastic investment by looking elsewhere. So take a look at this free list of interesting companies.

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 the financial statements are dated. This may not be consistent with the annual report figures for the full year.

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.

Valuation is complex, but we help make it simple.

Find out if Curro Holdings is potentially overvalued or undervalued by viewing our full analysis, which includes fair value estimates, risks and warnings, dividends, insider trading and financial health.

See the free analysis

Karen J. Nelson