Bradespar S.A.'s (BVMF:BRAP3) institutional shareholders had a great week as one-year returns increased after a 5.3% gain last week

Key Insights

• Significantly high institutional ownership implies Bradespar's stock price is sensitive to their trading actions
• The top 7 shareholders own 52% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

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A look at the shareholders of Bradespar S.A. (BVMF:BRAP3) can tell us which group is most powerful. With 50% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, institutional investors ended up benefitting the most after the company hit R$6.9b in market cap. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 3.7%.

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

See our latest analysis for Bradespar

What Does The Institutional Ownership Tell Us About Bradespar?

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.

Bradespar 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. 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 Bradespar's earnings history below. Of course, the future is what really matters.

Bradespar is not owned by hedge funds. Cidade de Deus - Companhia Comercial de Participações is currently the company's largest shareholder with 22% of shares outstanding. Invesco Ltd. is the second largest shareholder owning 6.6% of common stock, and Grantham Mayo Van Otterloo & Co. LLC holds about 6.4% of the company stock.

On further inspection, we found that more than half the company's shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Bradespar

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.

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 data cannot confirm that board members are holding shares personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

With a 28% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Bradespar. 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.

Private Company Ownership

We can see that Private Companies own 23%, of the shares on issue. 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:

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 Bradespar (of which 1 is concerning!) 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. 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.