Private companies who hold 53% of EZTEC Empreendimentos e Participações S.A. (BVMF:EZTC3) gained 7.0%, institutions profited as well

Key Insights

• The considerable ownership by private companies in EZTEC Empreendimentos e Participações indicates that they collectively have a greater say in management and business strategy
• 52% of the business is held by the top 12 shareholders
• 27% of EZTEC Empreendimentos e Participações is held by Institutions

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Every investor in EZTEC Empreendimentos e Participações S.A. (BVMF:EZTC3) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 53% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While private companies were the group that benefitted the most from last week’s R$284m market cap gain, institutions too had a 27% share in those profits.

Let's take a closer look to see what the different types of shareholders can tell us about EZTEC Empreendimentos e Participações.

View our latest analysis for EZTEC Empreendimentos e Participações

What Does The Institutional Ownership Tell Us About EZTEC Empreendimentos e Participações?

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.

We can see that EZTEC Empreendimentos e Participações does have institutional investors; and they hold a good portion of the company's stock. 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. 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 EZTEC Empreendimentos e Participações, (below). Of course, keep in mind that there are other factors to consider, too.

EZTEC Empreendimentos e Participações is not owned by hedge funds. Navi Holding Participacoes S.A. is currently the largest shareholder, with 5.2% of shares outstanding. The second and third largest shareholders are EZ5 Participacoes Ltda. and SMM Participações e Empreedimentos S/A, with an equal amount of shares to their name at 5.1%.

After doing some more digging, we found that the top 12 have the combined ownership of 52% in the company, suggesting that no single shareholder has significant control over 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 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 EZTEC Empreendimentos e Participações

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can see that insiders own shares in EZTEC Empreendimentos e Participações S.A.. In their own names, insiders own R$154m worth of stock in the R$4.3b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over EZTEC Empreendimentos e Participações. 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

We can see that Private Companies own 53%, 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:

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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for EZTEC Empreendimentos e Participações you should know about.

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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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.