AEM Holdings Ltd.' s (SGX:AWX) latest 7.7% decline adds to one-year losses, institutional investors may consider drastic measures

Key Insights

• Significantly high institutional ownership implies AEM Holdings' stock price is sensitive to their trading actions
• A total of 8 investors have a majority stake in the company with 51% ownership
• Analyst forecasts  along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of AEM Holdings Ltd. (SGX:AWX), it is important to understand the ownership structure of the business. With 41% stake, institutions possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And so it follows that institutional investors was the group most impacted after the company' s market cap fell to S$958m last week after a 7.7% drop in the share price. This set of investors may especially be concerned about the current loss, which adds to a one-year loss of 3.8% for shareholders. Also referred to as " smart money" , institutions have a lot of sway over how a stock' s price moves. As a result, if the decline continues, institutional investors may be pressured to sell AEM Holdings which might hurt individual investors.

In the chart below, we zoom in on the different ownership groups of AEM Holdings.

See our latest analysis for AEM Holdings

What Does The Institutional Ownership Tell Us About AEM Holdings?

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.

AEM Holdings already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can' t rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 AEM Holdings' historic earnings and revenue below, but keep in mind there' s always more to the story.

Hedge funds don' t have many shares in AEM Holdings. Looking at our data, we can see that the largest shareholder is Temasek Holdings (Private) Limited with 13% of shares outstanding. Employees Provident Fund of Malaysia is the second largest shareholder owning 11% of common stock, and abrdn plc holds about 10% of the company stock.