I've been keeping a close eye on what substantial shareholders have been doing recently.
Substantial shareholders are shareholders that hold 5% or more of a company's shares. These tend to be large investors, asset managers, and investment funds. These shareholders are obliged to update the market when they make any changes to their holdings.
As a result, I feel investors should look to use these notices to their advantage. After all, they show where the so-called smart money is going.
Two notices that have caught my eye are summarised below:
Atlas Arteria Group (ASX: ALX)
According to a change of interests of substantial holder notice, Pendal Group Ltd (ASX: PDL) has been taking advantage of this toll road operator's share price decline by topping up its position. Over the last six weeks Pendal has added almost 9 million more shares to its holding, bringing its total to 52,937,306 shares. This represents a 6.02% stake in Atlas Arteria.
The toll road operator's shares are currently down 31% from their 52-week high amid concerns over the impact of the pandemic on traffic volumes. Pendal appears to be playing the long game and seems confident volumes and ultimately its earnings will rebound in the coming years.
WiseTech Global Ltd (ASX: WTC)
A change of interests of substantial holder notice reveals that another fund manager has been buying this logistics solutions company's shares. Hot on the heels of Hyperion Asset Management increasing its stake 6.12% to 7.29%, Pinnacle Investment Management has followed suit and picked up around 3.2 million shares.
According to the notice, Pinnacle Investment Management now owns 23,587,590 shares, which represents a 7.41% stake in the company. Both fund managers appear to believe the company's shares are trading at attractive levels following a sharp selloff in 2020. In addition to this, they may be pleased to have seen WiseTech Global recently reaffirm its guidance for FY 2020. WiseTech Global's shares are down 48.5% from their 52-week high.
