Is ViroGates A/S' (CPH:VIRO) Shareholder Ownership Skewed Towards Insiders?

By
Simply Wall St
Published
May 18, 2021
CPSE:VIRO
Source: Shutterstock

The big shareholder groups in ViroGates A/S (CPH:VIRO) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

With a market capitalization of kr.637m, ViroGates is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions don't own shares in the company. Let's delve deeper into each type of owner, to discover more about ViroGates.

Check out our latest analysis for ViroGates

ownership-breakdown
CPSE:VIRO Ownership Breakdown May 19th 2021

What Does The Lack Of Institutional Ownership Tell Us About ViroGates?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. ViroGates' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

earnings-and-revenue-growth
CPSE:VIRO Earnings and Revenue Growth May 19th 2021

Hedge funds don't have many shares in ViroGates. Niels Louis-Hansen is currently the company's largest shareholder with 26% of shares outstanding. The second and third largest shareholders are Kim Ginnerup and Lars Krogsgaard, with an equal amount of shares to their name at 10%. Lars Krogsgaard, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of ViroGates

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

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 most recent data indicates that insiders own the majority of ViroGates A/S. This means they can collectively make decisions for the company. That means they own kr.336m worth of shares in the kr.637m company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 47% ownership, the general public have some degree of sway over ViroGates. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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 4 warning signs for ViroGates (of which 1 is potentially serious!) you should know about.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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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