Old Mutual Limited (ODMUF), the South African financial giant, might be hiding a secret. It's not a secret whispered in hushed tones in boardrooms, nor one buried in complex financial statements. It's a secret hiding in plain sight, a silent specter haunting the company's financial data, one that seems to have eluded the keen eyes of Wall Street analysts.

Here's the enigma: Old Mutual is experiencing a dramatic reduction in its outstanding shares, a trend that started in 2018 and has accelerated in recent years. A closer look at the numbers paints a startling picture. In 2018, the company boasted a whopping 304,201,877,900 outstanding shares. Fast forward to 2023, and that number has shrunk to a mere 4,585,000,000, a staggering reduction of over 98%.

This isn't just a gradual decline; it's a financial freefall. In 2019 alone, outstanding shares plummeted from 304 billion to 4.8 billion. Since then, the pace has slowed, but the trend remains. In the most recent quarter (2023-Q4), the number stood at 239,699,800, down from 250,481,500 in the previous quarter.

Now, a reduction in outstanding shares isn't inherently alarming. Companies engage in share buyback programs to boost their stock price and enhance shareholder value. However, the sheer magnitude of Old Mutual's share reduction raises eyebrows and demands a deeper dive.

Here's why this is so intriguing. Share buyback programs, while common, are usually announced with fanfare. Companies tout them as a sign of financial strength and confidence in their future prospects. Yet, a thorough search for any announcements regarding a massive share buyback program by Old Mutual yields nothing. It's as if these shares simply vanished into thin air, leaving behind a financial phantom.

This begs the question: what's really going on? Could this be a strategic move shrouded in secrecy, a stealthy maneuver to consolidate ownership and prepare for a major shift in the company's direction? Or is there a more mundane explanation, perhaps a consolidation of shares following a merger or acquisition that hasn't been publicly disclosed?

Potential Implications of Share Shrinkage

Let's examine the potential implications of this mysterious share shrinkage. A drastic reduction in shares typically leads to a higher Earnings Per Share (EPS), a key metric used by investors to gauge a company's profitability. Looking at Old Mutual's financials, we see their EPS has remained relatively stable, even experiencing fluctuations into negative territory in recent years, despite the dramatic reduction in shares.