individual investors who own 56% along with institutions invested in Perpetual Limited (ASX:PPT) saw increase in their holdings value last week

Key Insights

• The considerable ownership by individual investors in Perpetual indicates that they collectively have a greater say in management and business strategy
• A total of 25 investors have a majority stake in the company with 43% ownership
• Institutional ownership in Perpetual is 30%

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Every investor in Perpetual Limited (ASX:PPT) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 56% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Individual investors gained the most after market cap touched AU$2.2b last week, while institutions who own 30% also benefitted.

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

View our latest analysis for Perpetual

What Does The Institutional Ownership Tell Us About Perpetual?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

As you can see, institutional investors have a fair amount of stake in Perpetual. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Perpetual, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Perpetual. Washington H. Soul Pattinson and Company Limited is currently the company's largest shareholder with 7.0% of shares outstanding. The second and third largest shareholders are State Street Global Advisors, Inc. and The Vanguard Group, Inc., with an equal amount of shares to their name at 6.2%.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Perpetual

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that Perpetual Limited insiders own under 1% of the company. However, it's possible that insiders might have an indirect interest through a more complex 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 AU$4.0m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 56% of Perpetual shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Public Company Ownership

It appears to us that public companies own 7.0% of Perpetual. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 1 warning sign for Perpetual you should be aware of.

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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.