Key Insights

• SHF Holdings' significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 3 shareholders own 52% of the company
• 13% of SHF Holdings is held by insiders

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To get a sense of who is truly in control of SHF Holdings, Inc. (NASDAQ:SHFS), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 39% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual investors on the other hand have a 28% ownership in the company.

Let's take a closer look to see what the different types of shareholders can tell us about SHF Holdings.

Check out our latest analysis for SHF Holdings

What Does The Institutional Ownership Tell Us About SHF Holdings?

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

SHF Holdings already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see SHF Holdings' historic earnings and revenue below, but keep in mind there's always more to the story.

Our data indicates that hedge funds own 10.0% of SHF Holdings. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Our data shows that Partner Colorado Credit Union is the largest shareholder with 39% of shares outstanding. In comparison, the second and third largest shareholders hold about 10.0% and 3.0% of the stock. Sundie Seefried, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. In addition, we found that Terry Mendez, the CEO has 1.2% of the shares allocated to their name.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 52% stake.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of SHF Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in SHF Holdings, Inc.. Insiders have a US$43m stake in this US$341m business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 28% 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 favour, they can still make a collective impact on company policies.

Private Company Ownership

It seems that Private Companies own 39%, of the SHF Holdings stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 2 warning signs for SHF Holdings that you should be aware of before investing here.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an 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 account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.