Stadler Rail AG's (VTX:SRAIL) stock price dropped 4.4% last week; individual investors would not be happy

Key Insights

• The considerable ownership by individual investors in Stadler Rail indicates that they collectively have a greater say in management and business strategy
• A total of 7 investors have a majority stake in the company with 51% ownership
• Insiders own 14% of Stadler Rail

Every investor in Stadler Rail AG (VTX:SRAIL) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 40% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, individual investors endured the biggest losses as the stock fell by 4.4%.

Let's take a closer look to see what the different types of shareholders can tell us about Stadler Rail.

View our latest analysis for Stadler Rail

What Does The Institutional Ownership Tell Us About Stadler Rail?

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 Stadler Rail does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Stadler Rail, (below). Of course, keep in mind that there are other factors to consider, too.

Stadler Rail is not owned by hedge funds. PCS Holding AG is currently the largest shareholder, with 31% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 3.2% of the stock. Peter Spuhler, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Stadler Rail

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Stadler Rail AG. It has a market capitalization of just CHF2.4b, and insiders have CHF343m worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 40% stake in Stadler Rail. 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 Equity Ownership

With a stake of 31%, private equity firms could influence the Stadler Rail board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Stadler Rail better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Stadler Rail .

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.