Key Insights

• The considerable ownership by retail investors in Data#3 indicates that they collectively have a greater say in management and business strategy

• 37% of the business is held by the top 25 shareholders

• Insiders have been buying lately

A look at the shareholders of Data#3 Limited (ASX:DTL) can tell us which group is most powerful. The group holding the most number of shares in the company, around 60% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Institutions, on the other hand, account for 30% of the company's stockholders. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.

In the chart below, we zoom in on the different ownership groups of Data#3.

View our latest analysis for Data#3

What Does The Institutional Ownership Tell Us About Data#3?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Data#3 does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Data#3's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Data#3. The company's largest shareholder is State Street Global Advisors, Inc., with ownership of 5.3%. Meanwhile, the second and third largest shareholders, hold 5.0% and 3.2%, of the shares outstanding, respectively.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Data#3

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.