The big shareholder groups in Shenandoah Telecommunications Company (NASDAQ:SHEN) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. We also tend to see lower insider ownership in companies that were previously publicly owned.
Shenandoah Telecommunications has a market capitalization of US$1.1b, so we would expect some institutional investors to have noticed the stock. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. Let’s delve deeper into each type of owner, to discover more about Shenandoah Telecommunications.
What Does The Institutional Ownership Tell Us About Shenandoah Telecommunications?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that Shenandoah Telecommunications does have institutional investors; and they hold a good portion of the company’s stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It’s therefore worth looking at Shenandoah Telecommunications’ earnings history below. Of course, the future is what really matters.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hedge funds don’t have many shares in Shenandoah Telecommunications. Our data shows that BlackRock, Inc. is the largest shareholder with 16% of outstanding shares. The Vanguard Group, Inc. is the second largest shareholder owning 10% of common stock, and Christopher French holds about 3.7% of the company stock. Christopher French, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.
After doing some more digging, we found that the top 20 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.
While studying institutional ownership for a company can add value to your research, it is also good practice to research analyst recommendations to get a deeper understanding of the stock’s expected performance. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Shenandoah Telecommunications
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own some shares in Shenandoah Telecommunications Company. The insiders have a meaningful stake worth US$44m. Most would see this as a real positive. Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.
General Public Ownership
The general public– including retail investors–owns 41% stake in the company, and hence can’t easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favor, they can still make a collective impact on company policies.
It’s always worth thinking about the different groups who own shares in a company. But to understand Shenandoah Telecommunications better, we need to consider many other factors. Be aware that Shenandoah Telecommunications is showing 2 warning signs in our investment analysis you should know about…
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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.
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