The large shareholder groups of Matrix Service Company (NASDAQ:MTRX) have power over the company. Institutions often own shares in more established companies, while it is not uncommon to see insiders owning a good number of smaller companies. Companies that were previously publicly owned tend to have less insider ownership.
Matrix Service is a small company with a market capitalization of US$181 million, so it may still fly under the radar of many institutional investors. Our analysis of company ownership, below, shows that institutional investors have bought the company. We can zoom in on the different ownership groups, to learn more about Matrix Service.
Check out our latest analysis for Matrix Service
What does institutional ownership tell us about Matrix Service?
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.
Matrix Service already has institutions on the share register. Indeed, they hold a respectable stake in the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it’s worth checking out Matrix Service’s revenue history below. Of course, the future is what really matters.
Institutional investors own more than 50% of the company, so together they can probably heavily influence board decisions. Matrix Service is not owned by hedge funds. The company’s largest shareholder is BlackRock, Inc., with a 9.0% stake. BNY Mellon Asset Management is the second largest shareholder with 7.2% of common stock and Dimensional Fund Advisors LP owns approximately 5.4% of the company’s stock. Additionally, CEO John Hewitt owns 1.1% of the company’s stock.
Looking at the shareholder register, we can see that 50% of the ownership is controlled by the 12 major shareholders, which means that no shareholder has a controlling interest in the ownership.
While it makes sense to study data on a company’s institutional ownership, it also makes sense to study analyst sentiment to find out which way the wind is blowing. Although there is some analyst coverage, the company is probably not widely covered. So it could attract more attention, on the track.
Matrix Service Insider Ownership
The definition of an insider may differ slightly from country to country, but board members still matter. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.
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.
We can see that insiders hold shares in Matrix Service Company. It has a market capitalization of just $181 million and insiders own $5.7 million in shares, in their own name. It’s good to see insider investing, but we generally like to see higher insider holdings. It might be worth checking to see if these insiders have bought.
General public property
The general public, including retail investors, owns 10% of the company’s capital and therefore cannot be easily ignored. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
It is always useful to think about the different groups that own shares in a company. But to better understand Matrix Service, we need to consider many other factors. Take for example the ubiquitous specter of investment risk. We have identified 1 warning sign with Matrix Service, and understanding them should be part of your investment process.
If you prefer to 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 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.
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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.