While institutions own 42% of The Lottery Corporation Limited (ASX:TLC), retail investors are its largest shareholders with 56% ownership
In This Article:
Key Insights
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The considerable ownership by retail investors in Lottery indicates that they collectively have a greater say in management and business strategy
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40% of the business is held by the top 25 shareholders
If you want to know who really controls The Lottery Corporation Limited (ASX:TLC), 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 56% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Meanwhile, institutions make up 42% of the company’s shareholders. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.
In the chart below, we zoom in on the different ownership groups of Lottery.
View our latest analysis for Lottery
What Does The Institutional Ownership Tell Us About Lottery?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
Lottery already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Lottery's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Lottery. Our data shows that Australian Super Pty Ltd is the largest shareholder with 12% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 6.1% and 5.6%, of the shares outstanding, respectively.
A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
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.