The big shareholder groups in Carmila S.A. (EPA:CARM) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Companies that have been privatized tend to have low insider ownership.
With a market capitalization of €1.6b, Carmila is a decent size, so it is probably on the radar of institutional investors. In the chart below, we can see that institutions own shares in the company. Let’s delve deeper into each type of owner, to discover more about Carmila.
What Does The Institutional Ownership Tell Us About Carmila?
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.
Carmila already has institutions on the share registry. Indeed, they own 32% of the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Carmila’s historic earnings and revenue, below, but keep in mind there’s always more to the story.
Hedge funds don’t have many shares in Carmila. Carrefour SA is currently the largest shareholder, with 35% of shares outstanding. Crédit Agricole Group is the second largest shareholder with 9.2% of common stock, followed by BNP Paribas, Private & Investment Banking Investments, holding 8.8% of the stock.
Further, we found that the top 3 shareholders have a combined ownership of 53% in the company, meaning that they are powerful enough to influence the decisions of the company.
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 Carmila
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our data suggests that insiders own under 1% of Carmila S.A. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It’s a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own €108k worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public, with a 22% stake in the company, will not easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Company Ownership
Our data indicates that Private Companies hold 11%, of the company’s shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Public Company Ownership
Public companies currently own 35% of CARM stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
It’s always worth thinking about the different groups who own shares in a company. But to understand Carmila better, we need to consider many other factors. To that end, you should learn about the 5 warning signs we’ve spotted with Carmila (including 2 which is are potentially serious) .
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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. 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.
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