Key Insights

• Significant insider control over Australian Agricultural implies vested interests in company growth
• The largest shareholder of the company is Bryan Glinton with a 53% stake
• Recent purchases by insiders

To get a sense of who is truly in control of Australian Agricultural Company Limited (ASX:AAC), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 76% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

A quick look at our data suggests that insiders have been buying shares in the company recently. This might indicate that they expect share prices to rise in the near future.

Let's delve deeper into each type of owner of Australian Agricultural, beginning with the chart below.

See our latest analysis for Australian Agricultural

What Does The Institutional Ownership Tell Us About Australian Agricultural?

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.

We can see that Australian Agricultural does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Australian Agricultural's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Australian Agricultural. Bryan Glinton is currently the company's largest shareholder with 53% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. In comparison, the second and third largest shareholders hold about 22% and 1.9% of the stock.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Australian Agricultural

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 own more than half of Australian Agricultural Company Limited. This gives them effective control of the company. Given it has a market cap of AU$946m, that means they have AU$723m worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Australian Agricultural. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Australian Agricultural is showing 2 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

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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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.