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Basic concepts

  • Significantly high institutional ownership suggests that Catena Media’s stock prices are sensitive to their trading activity.
  • The top 8 shareholders own 51% of the company
  • A proprietary study combined with past performance data can help to gain a good understanding of a stock’s opportunities.

If you want to know who really controls Catena Media plc (STO:CTM), then you need to look at its share register. With a 48% stake, the institutions hold the most stake in the company. That is, the group will gain the most if the stock goes up (or lose the most if it goes down).

And so it follows that institutional investors were the most affected after the company’s market cap fell to 1.6 billion kr last week following a 10% drop in its share price. The latest loss, which adds 55% to shareholders’ one-year loss, may not sit well with this group of investors. Also called “smart money,” institutions have a large influence on stock price movements. Therefore, if Catena Media’s share price weakness continues, institutional investors may feel pressured to sell shares, which may not be ideal for individual investors.

In the chart below, we zoom in on Catena Media’s various ownership groups.

See our latest analysis for Catena Media

OM:CTM ownership distribution on December 18, 2022

What does institutional ownership tell us about Catena Media?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock when it is included in a major index. We expect that most companies will have some facilities on the register, especially if they are growing.

Catena Media already has facilities in the share register. Indeed, they have a respectable stake in the company. This can indicate that the company has some credibility in the investment community. However, it is best to be careful when relying on the implied validation that comes with institutional investors. They are also sometimes wrong. If multiple institutions change their view on a stock at the same time, you can see the stock price drop quickly. Therefore, it is worth taking a look at Catena Media’s earnings history below. Of course, the future is really important.

revenue and earnings growth
OM:CTM Earnings and Earnings Growth as of December 18, 2022

Hedge funds appear to own 6.3% of Catena Media’s stock. It catches my attention because hedge funds sometimes try to influence management or make changes that will create near-term value for shareholders. Alcur Fonder Ab is currently the company’s largest shareholder with an 8.5% stake. The second and third largest shareholders are Investment AB Öresund (publ) and Avanza Fonder AB, whose nominal shares are equal to 7.9%.

We also noticed that the top 8 shareholders own more than half of the share register, with several smaller shareholders to somewhat balance the interests of the larger ones.

While it makes sense to look at a company’s institutional ownership data, it also makes sense to look at analyst sentiment to know which way the wind is blowing. While there is some analyst coverage, the company is likely not widely covered. So it can get more attention, down the track.

Internal Proprietary of Catena Media

The definition of company insiders can be subjective and varies between jurisdictions. Our data reflect individual insiders, capturing at least board members. The management of the company runs the business, but the CEO will answer to the board even if he is a member of it.

Many view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, in some cases too much power is concentrated within this group.

Our data shows that insiders own more than 1% of Catena Media plc in their own name. We note, however, that insiders may have an indirect interest through a private company or other corporate entity. Apparently the board has about 13 million worth of stock. This compares to a market capitalization of kr1.6b. Most people tend to prefer to see a board with larger shares. A good next step might be this free summary of insider trading.

Common public property

The general public, typically individual investors, owns 40% of Catena Media. While this group may not necessarily call the shots, it can certainly have a real impact on how the company is run.

Private company ownership

Our data shows that private companies own 4.7% of the company’s shares. It’s hard to draw any conclusions from this fact alone, so it’s worth looking into who owns these private companies. Sometimes insiders or other related parties have an interest in the stock of a public company through a separate private company.

Next steps.

While it is worth considering the different groups that own a company, there are other factors that are more important. Be aware that Catena Media is exhibiting 2 warning signs in our investment analysis you should know about it…

If you prefer to discover what analysts are predicting in terms of future growth, don’t miss this free of charge report on analysts’ forecasts.

Note: The figures in this article are calculated using data for the last twelve months covering the 12-month period ending on the last day of the month in which the financial statement is dated. This may not correspond to the figures in the annual report for the full year.

Valuation is complicated, but we help make it simple.

Find out if Catena Media: can be over or under rated by checking out our comprehensive analysis which includes fair value estimates, risks and caveats, dividends, insider trading and financial health.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. We aim to provide you with long-term focused analysis based on fundamental data. Note that our analysis may not take into account recent price-sensitive company announcements or quality materials. Simply Wall St has no position in the listed stocks.

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