How Much Of Artis Real Estate Investment Trust (TSE:AX.UN) Do Institutions Own?

By
Simply Wall St
Published
June 06, 2021
TSX:AX.UN
Source: Shutterstock

The big shareholder groups in Artis Real Estate Investment Trust (TSE:AX.UN) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that have been privatized tend to have low insider ownership.

With a market capitalization of CA$1.5b, Artis Real Estate Investment Trust is a decent size, so it is probably on the radar of institutional investors. In the chart below, we can see that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Artis Real Estate Investment Trust.

See our latest analysis for Artis Real Estate Investment Trust

ownership-breakdown
TSX:AX.UN Ownership Breakdown June 7th 2021

What Does The Institutional Ownership Tell Us About Artis Real Estate Investment Trust?

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 Artis Real Estate Investment Trust 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 Artis Real Estate Investment Trust's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
TSX:AX.UN Earnings and Revenue Growth June 7th 2021

Artis Real Estate Investment Trust is not owned by hedge funds. Our data shows that Sandpiper Asset Management, Inc is the largest shareholder with 13% of shares outstanding. Estate of Ronald V. Joyce is the second largest shareholder owning 12% of common stock, and The Vanguard Group, Inc. holds about 3.8% of the company stock. Additionally, the company's CEO Samir Manji directly holds 1.3% of the total shares outstanding.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Artis Real Estate Investment Trust

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Artis Real Estate Investment Trust. This is a big company, so it is good to see this level of alignment. Insiders own CA$24m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public holds a substantial 50% stake in Artis Real Estate Investment Trust, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Equity Ownership

With an ownership of 13%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 12%, 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Artis Real Estate Investment Trust better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Artis Real Estate Investment Trust , and understanding them should be part of your investment process.

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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