MRV Engenharia e Participações S.A.'s (BVMF:MRVE3) most bullish insider, Top Key Executive Rubens Menin de Souza must be pleased with the recent 12% gain

Key Insights

• Significant insider control over MRV Engenharia e Participações implies vested interests in company growth
• A total of 5 investors have a majority stake in the company with 52% ownership
• Institutions own 31% of MRV Engenharia e Participações

If you want to know who really controls MRV Engenharia e Participações S.A. (BVMF:MRVE3), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 32% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders scored the highest last week as the company hit R$3.1b market cap following a 12% gain in the stock.

Let's delve deeper into each type of owner of MRV Engenharia e Participações, beginning with the chart below.

View our latest analysis for MRV Engenharia e Participações

What Does The Institutional Ownership Tell Us About MRV Engenharia e Participações?

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.

MRV Engenharia e Participações already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 MRV Engenharia e Participações' historic earnings and revenue below, but keep in mind there's always more to the story.

MRV Engenharia e Participações is not owned by hedge funds. Our data suggests that Rubens Menin de Souza, who is also the company's Top Key Executive, holds the most number of shares at 32%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. For context, the second largest shareholder holds about 6.1% of the shares outstanding, followed by an ownership of 5.7% by the third-largest shareholder.

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 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 MRV Engenharia e Participações

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

It seems insiders own a significant proportion of MRV Engenharia e Participações S.A.. It has a market capitalization of just R$3.1b, and insiders have R$995m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 25% 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

Our data indicates that Private Companies hold 5.7%, of the company's shares. 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.

Public Company Ownership

It appears to us that public companies own 6.1% of MRV Engenharia e Participações. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for MRV Engenharia e Participações (of which 1 is potentially serious!) you should know about.

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.