Lovisa Holdings Limited (ASX:LOV) insiders have had a fantastic week as stock increased 5.6%, and they haven't stopped buying

Key Insights

• Insiders appear to have a vested interest in Lovisa Holdings' growth, as seen by their sizeable ownership
• A total of 3 investors have a majority stake in the company with 50% ownership
• Insiders have been buying lately

A look at the shareholders of Lovisa Holdings Limited (ASX:LOV) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Our data shows that insiders recently bought shares in the company and they were rewarded after market cap rose AU$179m last week.

Let's delve deeper into each type of owner of Lovisa Holdings, beginning with the chart below.

See our latest analysis for Lovisa Holdings

What Does The Institutional Ownership Tell Us About Lovisa Holdings?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Lovisa Holdings does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Lovisa Holdings' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Lovisa Holdings. Looking at our data, we can see that the largest shareholder is Brett Blundy with 39% of shares outstanding. For context, the second largest shareholder holds about 6.1% of the shares outstanding, followed by an ownership of 5.3% by the third-largest shareholder. In addition, we found that Victor Herrero Amigo, the CEO has 2.8% of the shares allocated to their name.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 50% stake.

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 Lovisa Holdings

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. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Lovisa Holdings Limited. Insiders own AU$1.5b worth of shares in the AU$3.4b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 26% stake in Lovisa Holdings. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Lovisa Holdings better, we need to consider many other factors. Take risks for example - Lovisa Holdings has 1 warning sign we think you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.