Recent uptick might appease Viva Energy Group Limited (ASX:VEA) institutional owners after losing 13% over the past year

Key Insights

• Institutions' substantial holdings in Viva Energy Group implies that they have significant influence over the company's share price
• A total of 5 investors have a majority stake in the company with 52% ownership
• Insiders have been buying lately

To get a sense of who is truly in control of Viva Energy Group Limited (ASX:VEA), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 40% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Institutional investors would appreciate the 4.9% increase in share price last week, given their one-year losses have totalled a disappointing 13%.

In the chart below, we zoom in on the different ownership groups of Viva Energy Group.

See our latest analysis for Viva Energy Group

What Does The Institutional Ownership Tell Us About Viva Energy Group?

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.

We can see that Viva Energy Group does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Viva Energy Group's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Viva Energy Group. The company's largest shareholder is Viva Energy B.V., with ownership of 29%. L1 Capital Pty. Limited is the second largest shareholder owning 6.6% of common stock, and State Street Global Advisors, Inc. holds about 6.4% of the company stock. Additionally, the company's CEO Scott Wyatt directly holds 0.5% of the total shares outstanding.

On looking further, we found that 52% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Viva Energy Group

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 most recent data indicates that insiders own less than 1% of Viva Energy Group Limited. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around AU$26m worth of shares (at current prices). 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, who are usually individual investors, hold a 30% stake in Viva Energy Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 29%, of the shares on issue. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Viva Energy Group better, we need to consider many other factors. For instance, we've identified 3 warning signs for Viva Energy Group (1 is a bit concerning) that you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.