What Type Of Shareholders Make Up BrasilAgro - Companhia Brasileira de Propriedades Agrícolas' (BVMF:AGRO3) Share Registry?

The big shareholder groups in BrasilAgro - Companhia Brasileira de Propriedades Agrícolas (BVMF:AGRO3) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

BrasilAgro - Companhia Brasileira de Propriedades Agrícolas is not a large company by global standards. It has a market capitalization of R$1.5b, which means it wouldn't have the attention of many institutional investors. In the chart below, we can see that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about BrasilAgro - Companhia Brasileira de Propriedades Agrícolas.

See our latest analysis for BrasilAgro - Companhia Brasileira de Propriedades Agrícolas

What Does The Institutional Ownership Tell Us About BrasilAgro - Companhia Brasileira de Propriedades Agrícolas?

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 BrasilAgro - Companhia Brasileira de Propriedades Agrícolas 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. 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 BrasilAgro - Companhia Brasileira de Propriedades Agrícolas' historic earnings and revenue below, but keep in mind there's always more to the story.

It looks like hedge funds own 14% of BrasilAgro - Companhia Brasileira de Propriedades Agrícolas shares. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria is currently the largest shareholder, with 34% of shares outstanding. Autonomy Capital Jersey LP is the second largest shareholder owning 14% of common stock, and Charles River Capital holds about 9.4% of the company stock.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence 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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of BrasilAgro - Companhia Brasileira de Propriedades Agrícolas

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.

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 some shares in BrasilAgro - Companhia Brasileira de Propriedades Agrícolas. It has a market capitalization of just R$1.5b, and insiders have R$101m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public holds a 23% stake in BrasilAgro - Companhia Brasileira de Propriedades Agrícolas. 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.

Public Company Ownership

We can see that public companies hold 39% of the BrasilAgro - Companhia Brasileira de Propriedades Agrícolas shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that BrasilAgro - Companhia Brasileira de Propriedades Agrícolas is showing 2 warning signs in our investment analysis , you should know about...

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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. 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.
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