Private companies account for 55% of VGP NV's (EBR:VGP) ownership, while individual investors account for 16%

By
Simply Wall St
Published
April 19, 2022
ENXTBR:VGP
Source: Shutterstock

Every investor in VGP NV (EBR:VGP) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 55% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Individual investors, on the other hand, account for 16% of the company's stockholders.

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

Check out our latest analysis for VGP

ownership-breakdown
ENXTBR:VGP Ownership Breakdown April 19th 2022

What Does The Institutional Ownership Tell Us About VGP?

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.

As you can see, institutional investors have a fair amount of stake in VGP. 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. 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 VGP's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
ENXTBR:VGP Earnings and Revenue Growth April 19th 2022

VGP is not owned by hedge funds. VM Invest NV is currently the largest shareholder, with 36% of shares outstanding. Little Rock SA is the second largest shareholder owning 19% of common stock, and Jan Van Geet holds about 13% of the company stock. Jan Van Geet, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of VGP

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 most recent data indicates that insiders own a reasonable proportion of VGP NV. It has a market capitalization of just €5.3b, and insiders have €702m worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 16% stake in the company, and hence can't 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

It seems that Private Companies own 55%, of the VGP stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand VGP better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for VGP you should be aware of, and 3 of them shouldn't be ignored.

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.

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