NWPX Infrastructure, Inc.’s (NASDAQ:NWPX) market cap decline of US$60m may not have as much of an impact on institutional owners after a year of 6.4% returns

Key Insights

• Significantly high institutional ownership implies NWPX Infrastructure’s stock price is sensitive to their trading actions
• A total of 10 investors have a majority stake in the company with 52% ownership
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

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Every investor in NWPX Infrastructure, Inc. (NASDAQ:NWPX) should be aware of the most powerful shareholder groups. We can see that institutions own the lion’s share in the company with 85% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Institutional investors endured the highest losses after the company’s market cap fell by US$60m last week. However, the 6.4% one-year return to shareholders might have softened the blow. But they would probably be wary of future losses.

Let’s take a closer look to see what the different types of shareholders can tell us about NWPX Infrastructure.

Check out our latest analysis for NWPX Infrastructure

What Does The Institutional Ownership Tell Us About NWPX Infrastructure?

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.

As you can see, institutional investors have a fair amount of stake in NWPX Infrastructure. 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. 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 NWPX Infrastructure’s historic earnings and revenue below, but keep in mind there’s always more to the story.

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. We note that hedge funds don’t have a meaningful investment in NWPX Infrastructure. BlackRock, Inc. is currently the largest shareholder, with 11% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.3% and 5.9%, of the shares outstanding, respectively. In addition, we found that Scott Montross, the CEO has 0.8% of the shares allocated to their name.

We did some more digging and found that 10 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. 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 NWPX Infrastructure

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Shareholders would probably be interested to learn that insiders own shares in NWPX Infrastructure, Inc.. It has a market capitalization of just US$567m, and insiders have US$19m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 12% ownership, the general public, mostly comprising of individual investors, have some degree of sway over NWPX Infrastructure. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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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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.