Institutional investors own a significant stake of 45% in NZME Limited (NZSE:NZM)

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17-05-2025

Given the large stake in the stock by institutions, NZME's stock price might be vulnerable to their trading decisions
The top 6 shareholders own 54% of the company
Insiders have been buying lately
We've discovered 1 warning sign about NZME. View them for free.
To get a sense of who is truly in control of NZME Limited (NZSE:NZM), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 45% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's delve deeper into each type of owner of NZME, beginning with the chart below.
Check out our latest analysis for NZME
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.
NZME already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 NZME's earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 6.5% of NZME. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. The company's largest shareholder is Spheria Asset Management Pty Ltd, with ownership of 19%. For context, the second largest shareholder holds about 11% of the shares outstanding, followed by an ownership of 9.3% by the third-largest shareholder. Additionally, the company's CEO Michael Boggs directly holds 1.6% of the total shares outstanding.
On further inspection, we found that more than half the company's shares are owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time.
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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
It seems insiders own a significant proportion of NZME Limited. Insiders have a NZ$25m stake in this NZ$217m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
The general public-- including retail investors -- own 34% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
It's always worth thinking about the different groups who own shares in a company. But to understand NZME better, we need to consider many other factors. For instance, we've identified 1 warning sign for NZME that you should be aware of.
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.
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.
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