While institutions invested in La Française de l'Energie S.A. (EPA:FDE) benefited from last week's 13% gain, individual investors stood to gain the most

Key Insights

• The considerable ownership by individual investors in La Française de l'Energie indicates that they collectively have a greater say in management and business strategy
• A total of 16 investors have a majority stake in the company with 50% ownership
• 20% of La Française de l'Energie is held by insiders

To get a sense of who is truly in control of La Française de l'Energie S.A. (EPA:FDE), it is important to understand the ownership structure of the business. With 39% stake, individual investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While individual investors were the group that benefitted the most from last week’s €19m market cap gain, institutions too had a 32% share in those profits.

Let's take a closer look to see what the different types of shareholders can tell us about La Française de l'Energie.

Check out our latest analysis for La Française de l'Energie

What Does The Institutional Ownership Tell Us About La Française de l'Energie?

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 La Française de l'Energie 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 La Française de l'Energie's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in La Française de l'Energie. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In La Française de l'Energie's case, its Top Key Executive, Julien Moulin, is the largest shareholder, holding 15% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.9% and 5.8%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 16 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

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

Insider Ownership Of La Française de l'Energie

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

It seems insiders own a significant proportion of La Française de l'Energie S.A.. Insiders have a €32m stake in this €159m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 39% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 8.6%, of the company's shares. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand La Française de l'Energie better, we need to consider many other factors. Be aware that La Française de l'Energie is showing 3 warning signs in our investment analysis , you should know about...

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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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.