Do the institutions own shares of JB Hi-Fi Limited (ASX: JBH)?

0


The large shareholder groups of JB Hi-Fi Limited (ASX: JBH) have power over the company. Generally speaking, as a business grows, institutions increase their participation. Conversely, insiders often decrease their ownership over time. Companies that were previously owned by the state tend to have fewer insiders.

With a market cap of A $ 5.6 billion, JB Hi-Fi is pretty big. We expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. Our analysis of company ownership, below, shows that institutions own shares in the company. Let’s dig deeper into each type of owner, to learn more about JB Hi-Fi.

Check out our latest review for JB Hi-Fi

Breakdown of ASX property: JBH June 18, 2021

What does institutional ownership tell us about JB Hi-Fi?

Many institutions measure their performance against an index that approximates the local market. Thus, they generally pay more attention to companies that are included in the major indices.

We see that JB Hi-Fi has institutional investors; and they own a large portion of the company’s shares. This suggests some credibility among professional investors. But we cannot rely on this fact alone because institutions sometimes make bad investments, like everyone else. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell stocks quickly. This risk is higher in a company without a history of growth. You can see JB Hi-Fi’s historical revenue and revenue below, but keep in mind that there is always more to tell.

profit and revenue growth
ASX: JBH Earnings and Revenue Growth June 18, 2021

Since institutional investors own more than half of the issued shares, the board will likely need to pay attention to their preferences. JB Hi-Fi is not owned by hedge funds. AustralianSuper Pty. Ltd. is currently the largest shareholder, with 11% of the shares outstanding. BlackRock, Inc. is the second largest shareholder holding 6.4% of the common stock, and Morgan Stanley, Investment Banking and Brokerage Investments owns approximately 6.2% of the company’s stock.

We further researched and found that 9 of the major shareholders represent around 51% of the register, which implies that in addition to the major shareholders there are a few smaller shareholders, thus balancing each other’s interests somewhat.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be achieved by studying the feelings of analysts. There are a reasonable number of analysts covering the stock, so it can be helpful to know their overall vision for the future.

JB Hi-Fi Insider Property

The definition of an insider may differ slightly from country to country, but board members still count. The management is ultimately responsible to the board. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.

Insider ownership is positive when it indicates that executives think like the real owners of the company. However, strong insider ownership can also confer immense power on a small group within the company. This can be negative in some circumstances.

Our data suggests that insiders own less than 1% of JB Hi-Fi Limited in their own name. Keep in mind that this is a large company and insiders own shares worth AU $ 39 million. The absolute value can be more important than the proportional part. It’s good to see board members owning stocks, but it might be worth checking out if those insiders have bought.

General public property

The general public holds 38% of the capital of JB Hi-Fi. While this group cannot necessarily take the lead, it can certainly have a real influence on the way the business is run.

Next steps:

While it is worth considering the different groups that own a business, there are other factors that are even more important. Note that JB Hi-Fi displays 2 warning signs in our investment analysis , and 1 of them should not be ignored …

If you’d rather find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.

NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last day of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.

Promoted
When trading JB Hi-Fi or any other investment, use the platform seen by many as the trader’s gateway to the global market, Interactive brokers. You get the cheapest * trading on stocks, options, futures, forex, bonds and funds from around the world from a single integrated account.

This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020

Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.


Share.

About Author

Leave A Reply