ASX 200 stock Aurizon Holdings Ltd (ASX: AZJ) finished the week in the green amid news it has attracted three new substantial holders.
The Aurizon share price rose by 0.61% this week to finish at $3.31 on Friday. By comparison, the S&P/ASX 200 Index (ASX: XJO) fell by 2.46% this week to finish at 7,144.7 points.
The freight railway operator lodged three new substantial holder notices with the ASX this week.
A substantial holder is any shareholder, company, or investment group with a 5% or higher stake.
The ASX requires companies to notify it each time a new substantial holder comes on board, or if there is a change in a substantial holder's position.
Let's take a look at the details.
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The fund managers taking big positions in this ASX 200 stock
Aurizon lodged the first substantial holder notice on Monday. The notice revealed that London fund manager Mondrian Investment Partners took a 5% stake in the company on 2 March.
Mondrian purchased just over 92.1 million Aurizon shares.
On Tuesday came the second substantial holder notice. This one detailed a 5.83% position in the ASX 200 stock taken by First Sentier Investors Holdings Pty Limited on 3 March.
First Sentier purchased just over 107.3 million Aurizon shares.
First Sentier spread its investment over a number of subsidiaries in Australia, Hong Kong, and the United Kingdom.
The notice explained that the voting power attached to the holding was split about 60:40 between First Sentier and its ultimate parent company, Mitsubishi UFJ Financial Group Inc (NYSE: MUFG).
Aurizon lodged a third substantial holder notice the following day acknowledging Mitsubishi UFJ Financial's own purchase of Aurizon shares on 3 March.
The company bought just over 107 million shares in the ASX 200 stock to give it a 5.81% stake.
Mitsubishi also purchased 3,000 options.
What does this mean for the Aurizon share price?
Well, fund managers are only going to invest in ASX 200 stocks that they think are likely to rise in value.
Therefore, their purchases can be instructive for ordinary ASX investors trying to identify good investment opportunities.
Fund managers have advantages over ordinary investors. They employ professional analysts and research teams to thoroughly check out the ASX 200 stocks they are considering investing in.
Not only that, but fundies themselves are often able to meet with company managers in person to grill them on the company's plans and to help them assess the capacity of the management team.
Fund managers will often cite excellent management teams as a reason for buying certain ASX 200 stocks.
However, it's worth remembering that fund managers can get it wrong.
Even with all that access and research, they still make bad calls now and then.
So, investors may like to keep an eye on what fundies do, but ultimately, they must make decisions based on their own research and instincts.
Aurizon set for a takeover?
Late last month, Wilsons equities strategist Rob Crookston named Aurizon among several ASX 200 stocks that he thinks are appealing takeover targets.
Crookston surmised that private ownership might make Aurizon operate better.
In a memo, Wilsons explained its reasons for tipping Aurizon as a takeover target:
Infrastructure asset, monopoly, relatively steady (high) cash flows. Might benefit from being taken private from an ESG perspective.
The Aurizon share price is down 10% in the year to date.
It is currently trading not far off its 52-week low of $3.23. It has a 52-week high of $4.25 per share.
