Could The Orion Energy Systems, Inc. (NASDAQ:OESX) Ownership Structure Tell Us Something Useful?
NASDAQ:OESX) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.” data-reactid=”28″>The big shareholder groups in Orion Energy Systems, Inc. (NASDAQ:OESX) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.
With a market capitalization of US$205m, Orion Energy Systems is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutional investors have bought into the company. Let’s delve deeper into each type of owner, to discover more about Orion Energy Systems.
See our latest analysis for Orion Energy Systems ” data-reactid=”30″> See our latest analysis for Orion Energy Systems
What Does The Institutional Ownership Tell Us About Orion Energy Systems?
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.
As you can see, institutional investors have a fair amount of stake in Orion Energy Systems. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Orion Energy Systems’ historic earnings and revenue below, but keep in mind there’s always more to the story.
It looks like hedge funds own 8.3% of Orion Energy Systems shares. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. North Star Investment Management Corporation is currently the largest shareholder, with 10% of shares outstanding. For context, the second largest shareholder holds about 8.3% of the shares outstanding, followed by an ownership of 6.0% by the third-largest shareholder. Furthermore, CEO Michael Altschaefl is the owner of 2.4% of the company’s shares.
After doing some more digging, we found that the top 13 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Orion Energy Systems
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
click here to see if they have been buying or selling. ” data-reactid=”72″>It seems insiders own a significant proportion of Orion Energy Systems, Inc.. Insiders have a US$32m stake in this US$205m business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
With a 33% ownership, the general public have some degree of sway over Orion Energy Systems. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
Orion Energy Systems is showing 1 warning sign in our investment analysis , you should know about…” data-reactid=”76″>While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Orion Energy Systems is showing 1 warning sign in our investment analysis , you should know about…
this free report showing analyst forecasts for its future.” data-reactid=”77″>If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”79″>This article by Simply Wall St is general in nature. 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.
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