While individual investors own 15% of Interparfums SA (EPA:ITP), public companies are its largest shareholders with 72% ownership

Key Insights

• The considerable ownership by public companies in Interparfums indicates that they collectively have a greater say in management and business strategy
• Inter Parfums, Inc. owns 72% of the company
• 13% of Interparfums is held by Institutions

Every investor in Interparfums SA (EPA:ITP) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 72% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual investors on the other hand have a 15% ownership in the company.

In the chart below, we zoom in on the different ownership groups of Interparfums.

See our latest analysis for Interparfums

What Does The Institutional Ownership Tell Us About Interparfums?

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 Interparfums. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Interparfums' 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 Interparfums. The company's largest shareholder is Inter Parfums, Inc., with ownership of 72%. This implies that they have majority interest control of the future of the company. With 2.7% and 1.2% of the shares outstanding respectively, Brown Capital Management, LLC and Invesco Ltd. 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Interparfums

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.

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 data suggests that insiders own under 1% of Interparfums SA in their own names. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own €3.3m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 15% 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.

Public Company Ownership

Public companies currently own 72% of Interparfums stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 1 warning sign for Interparfums that you should be aware of before investing here.

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.