Pinnacle Investment Management Group Limited (ASX:PNI) share price fell 4.0% last week; individual investors would not be happy

A look at the shareholders of Pinnacle Investment Management Group Limited (ASX:PNI) can tell us which group is more powerful. With a 46% stake, individual investors hold the most shares in the company. In other words, the group is likely to gain the most (or lose the most) from its investment in the business.

While insiders, who own 32% of the shares, were not spared by the market capitalization drop of A$85 million last week, individual investors as a group suffered the maximum losses

Let’s dig deeper into each Pinnacle Investment Management Group owner type, starting with the table below.

Check out our latest analysis for Pinnacle Investment Management Group

ASX: PNI Ownership Breakdown August 22, 2022

What does institutional ownership tell us about Pinnacle Investment Management Group?

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 own a sizeable portion of Pinnacle Investment Management Group. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Pinnacle Investment Management Group’s historical earnings and revenue below, but keep in mind there’s always more to tell.

earnings-and-revenue-growth
ASX: PNI Earnings and Revenue Growth August 22, 2022

Hedge funds don’t have a lot of shares in Pinnacle Investment Management Group. With a 9.4% stake, CEO Ian Macoun is the largest shareholder. Stephen R. Wilson is the second largest shareholder with 9.3% of common stock and Ethical Partners Funds Management owns approximately 5.3% of the company’s stock.

Looking at the shareholder register, we can see that 50% of the ownership is controlled by the 22 major shareholders, which means that no shareholder has a controlling interest in the ownership.

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. There are a reasonable number of analysts covering the stock, so it can be useful to know their overall view on the future.

Insider ownership of Pinnacle Investment Management Group

The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company answers to the board of directors and the latter must represent the interests of the shareholders. In particular, sometimes the senior executives themselves sit on the board of directors.

I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own a reasonable proportion of Pinnacle Investment Management Group Limited. Insiders hold A$669 million worth of shares in the A$2.1 billion company. It is quite significant. Good to see this level of investment. You can check here if these insiders have bought recently.

General public property

With a 46% stake, the general public, consisting primarily of individual investors, has some influence over Pinnacle Investment Management Group. This size of ownership, although considerable, may not be sufficient to change company policy if the decision is not in line with other major shareholders.

Next steps:

It is always useful to think about the different groups that own shares in a company. But to better understand Pinnacle Investment Management Group, we need to consider many other factors. For example, we found 3 warning signs for Pinnacle Investment Management Group (1 is a little unpleasant!) which you should be aware of before investing here.

At the end of the day the future is the most important. You can access this free analyst forecast report for the company.

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.

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.

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Karen J. Nelson