Grenergy Renovables, S.A.'s (BME:GRE) most bullish insider, CEO David Ruiz de Andrés must be pleased with the recent 4.1% gain

Key Insights

• Grenergy Renovables' significant insider ownership suggests inherent interests in company's expansion
• 54% of the company is held by a single shareholder (David Ruiz de Andrés)
• Institutional ownership in Grenergy Renovables is 16%

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A look at the shareholders of Grenergy Renovables, S.A. (BME:GRE) can tell us which group is most powerful. We can see that individual insiders own the lion's share in the company with 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, insiders benefitted the most after the company's market cap rose by €60m last week.

Let's delve deeper into each type of owner of Grenergy Renovables, beginning with the chart below.

View our latest analysis for Grenergy Renovables

What Does The Institutional Ownership Tell Us About Grenergy Renovables?

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.

As you can see, institutional investors have a fair amount of stake in Grenergy Renovables. 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. 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 Grenergy Renovables, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Grenergy Renovables. Looking at our data, we can see that the largest shareholder is the CEO David Ruiz de Andrés with 54% of shares outstanding. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. With 5.8% and 1.6% of the shares outstanding respectively, Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. and Invesco Capital Management LLC are the second and third largest shareholders.

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 Grenergy Renovables

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.

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 own more than half of Grenergy Renovables, S.A.. This gives them effective control of the company. Given it has a market cap of €1.5b, that means insiders have a whopping €830m worth of shares in their own names. Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 30% stake in the company, and hence can't easily be ignored. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Grenergy Renovables better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Grenergy Renovables (at least 2 which can't be ignored) , and understanding them should be part of your investment process.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.