Advertisement
New Zealand markets closed
  • NZX 50

    11,682.39
    -89.42 (-0.76%)
     
  • NZD/USD

    0.6132
    +0.0010 (+0.16%)
     
  • NZD/EUR

    0.5730
    +0.0016 (+0.27%)
     
  • ALL ORDS

    8,039.90
    +27.80 (+0.35%)
     
  • ASX 200

    7,796.00
    +26.60 (+0.34%)
     
  • OIL

    81.27
    -0.02 (-0.02%)
     
  • GOLD

    2,374.70
    +5.70 (+0.24%)
     
  • NASDAQ

    19,752.30
    -156.56 (-0.79%)
     
  • FTSE

    8,226.54
    -45.92 (-0.56%)
     
  • Dow Jones

    39,134.76
    +299.90 (+0.77%)
     
  • DAX

    18,163.69
    -90.49 (-0.50%)
     
  • Hang Seng

    18,028.52
    -306.80 (-1.67%)
     
  • NIKKEI 225

    38,596.47
    -36.55 (-0.09%)
     
  • NZD/JPY

    97.4350
    +0.2150 (+0.22%)
     

National Fuel Gas Company (NYSE:NFG) is a favorite amongst institutional investors who own 77%

Key Insights

  • Institutions' substantial holdings in National Fuel Gas implies that they have significant influence over the company's share price

  • 50% of the business is held by the top 13 shareholders

  • Insiders have sold recently

If you want to know who really controls National Fuel Gas Company (NYSE:NFG), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 77% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.

ADVERTISEMENT

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

See our latest analysis for National Fuel Gas

ownership-breakdown
ownership-breakdown

What Does The Institutional Ownership Tell Us About National Fuel Gas?

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 National Fuel Gas does have institutional investors; and they hold a good portion of the company's stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of National Fuel Gas, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
earnings-and-revenue-growth

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. National Fuel Gas is not owned by hedge funds. The Vanguard Group, Inc. is currently the company's largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.2% and 4.6% of the stock.

After doing some more digging, we found that the top 13 have the combined ownership of 50% 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. 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 National Fuel Gas

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Shareholders would probably be interested to learn that insiders own shares in National Fuel Gas Company. The insiders have a meaningful stake worth US$74m. Most would see this as a real positive. If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

With a 22% ownership, the general public, mostly comprising of individual investors, have some degree of sway over National Fuel Gas. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand National Fuel Gas better, we need to consider many other factors. Be aware that National Fuel Gas is showing 2 warning signs in our investment analysis , you should know about...

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.