Painful week for private companies invested in Aston Martin Lagonda Global Holdings plc (LON:AML) after 6.5% drop, institutions also suffered losses

Key Insights

• The considerable ownership by private companies in Aston Martin Lagonda Global Holdings indicates that they collectively have a greater say in management and business strategy
• The top 4 shareholders own 56% of the company
• 17% of Aston Martin Lagonda Global Holdings is held by insiders

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If you want to know who really controls Aston Martin Lagonda Global Holdings plc (LON:AML), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private companies with 25% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of private companies took a hit after last week’s 6.5% price drop, institutions with their 24% holdings also suffered.

Let's delve deeper into each type of owner of Aston Martin Lagonda Global Holdings, beginning with the chart below.

Check out our latest analysis for Aston Martin Lagonda Global Holdings

What Does The Institutional Ownership Tell Us About Aston Martin Lagonda Global Holdings?

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 Aston Martin Lagonda Global Holdings 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. 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 Aston Martin Lagonda Global Holdings' 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 Aston Martin Lagonda Global Holdings. The company's largest shareholder is Public Investment Fund, with ownership of 17%. With 16% and 13% of the shares outstanding respectively, Lawrence Stroll and Zhejiang Geely Holding Group Limited are the second and third largest shareholders. Lawrence Stroll, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

On looking further, we found that 56% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Aston Martin Lagonda Global Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Aston Martin Lagonda Global Holdings plc. It has a market capitalization of just UK£740m, and insiders have UK£123m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 10% stake in Aston Martin Lagonda Global Holdings. 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

We can see that Private Companies own 25%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Public Company Ownership

We can see that public companies hold 7.5% of the Aston Martin Lagonda Global Holdings shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Aston Martin Lagonda Global Holdings better, we need to consider many other factors. Take risks for example - Aston Martin Lagonda Global Holdings has 2 warning signs we think you should be aware of.

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.