Every investor in VOXX International Corporation (NASDAQ:VOXX) should know the most powerful shareholder groups. Insiders often own a large portion of younger, smaller companies, while larger companies tend to have institutions as shareholders. Warren Buffett said he likes “a business with enduring competitive advantages that is led by capable, owner-oriented people.” So it’s nice to see some insider ownership, as it may suggest management is owner-driven.
With a market capitalization of US$170 million, VOXX International is a small cap stock, so it may not be well known to many institutional investors. Looking at our ownership group data (below), it appears that institutional investors have bought the company. Let’s dig deeper into each owner type to learn more about VOXX International.
Check out our latest analysis for VOXX International
What does institutional ownership tell us about VOXX International?
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.
VOXX International 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. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see VOXX International’s historical revenue and earnings below, but keep in mind there’s always more to the story.
We note that hedge funds have no significant investment in VOXX International. Avalon Park Group Holding AG is currently the company’s largest shareholder with 18% of outstanding shares. For context, the second shareholder owns approximately 17% of the outstanding shares, followed by a 9.7% ownership by the third shareholder. Additionally, the company’s CEO, Patrick Lavelle, directly owns 1.9% of the total shares outstanding.
Looking further, we found that 51% of the shares are held by the top 4 shareholders. In other words, these shareholders have a say in the decisions of the company.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand a stock’s expected performance. Although there is some analyst coverage, the company is probably not widely covered. So it could attract more attention, on the track.
Insider Ownership of VOXX International
The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company answers to the board of directors and the latter must represent the interests of the shareholders. In particular, sometimes the senior executives themselves sit on the board of directors.
Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.
It appears that insiders own a significant share of VOXX International Corporation. Insiders hold $39 million worth of stock in the $170 million company. This may suggest that the founders still own a lot of shares. You can click here to see if they bought or sold.
General public property
The general public, including retail investors, owns 18% 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.
Private Company Ownership
Our data indicates that private companies own 18% of the company’s shares. It might be worth exploring this further. If related parties, such as insiders, have an interest in any of these private companies, this should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. Take risks for example – VOXX International has 1 warning sign we think you should know.
If you’re like me, you might want to ask yourself if this business will grow or shrink. Luckily, you can check out this free report showing analyst predictions for its future.
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.