Yellow Pages Limited (TSE:Y) is favored by hedge fund owners who own 55% of the business

A look at the shareholders of Yellow Pages Limited (TSE:Y) can tell us which group is the most powerful. The group with the largest number of shares in the company, around 55% to be precise, are the hedge funds. That is, the group will benefit the most if the stock goes up (or lose the most if there is a downturn).

Since hedge fund owners have a huge pool of resources and liquidity, their investment decisions tend to carry a lot of weight, especially with individual investors. Therefore, having a considerable amount of institutional money invested in a business is often considered a desirable trait.

In the table below, we zoom in on the different Yellow Pages ownership groups.

Check out our latest analysis for the Yellow Pages

distribution of property

What does institutional ownership tell us about the yellow pages?

Institutional investors typically compare their own returns to the returns of a commonly tracked index. They therefore generally consider buying larger companies that are included in the relevant benchmark.

As you can see, institutional investors own a sizable share of the Yellow Pages. 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. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it’s worth checking out the Yellow Pages revenue history below. Of course, the future is what really matters.

earnings-and-revenue-growth

earnings-and-revenue-growth

Our data indicates that hedge funds own 55% of yellow pages. This catches my attention because hedge funds sometimes try to influence management or make changes that will create short-term shareholder value. The company’s largest shareholder is Canso Investment Counsel Ltd., with a 26% stake. Meanwhile, the second and third largest shareholders hold 24% and 17% of the outstanding shares respectively.

After digging a little deeper, we found that the top 3 shareholders collectively control more than half of the company’s stock, implying that they have considerable power to influence company decisions.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. There is some analyst coverage of the stock, but it could still become better known over time.

Yellow Pages Insider Property

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.

Our information suggests that Yellow Pages Limited insiders own less than 1% of the company. It has a market capitalization of just C$331 million and the board of directors owns only C$2.3 million of shares in its own name. Many investors in small companies prefer to see the board more heavily invested. You can click here to see if these insiders have been buying or selling.

General public property

The general public, who are usually individual investors, hold a 14% stake in Yellow Pages. While that size of ownership might not be enough to sway a policy decision in their favor, they can still have a collective impact on company policies.

Next steps:

While it is worth considering the different groups that own a business, there are other, even more important factors. For example, we found 1 yellow pages warning sign which you should be aware of before investing here.

But finally it’s the future, not the past, which will determine the performance of the owners of this company. Therefore, we think it’s advisable to take a look at this free report showing whether analysts are predicting a brighter 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 the financial statements are dated. This may not be consistent with the annual report figures for the full year.

Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.

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.

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Calvin W. Soper