What Is The Ownership Structure Like For Aston Martin Lagonda Global Holdings plc (LON:AML)?

By
Simply Wall St
Published
October 09, 2020
LSE:AML

A look at the shareholders of Aston Martin Lagonda Global Holdings plc (LON:AML) can tell us which group is most powerful. 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.

Aston Martin Lagonda Global Holdings isn't enormous, but it's not particularly small either. It has a market capitalization of UK£926m, which means it would generally expect to see some institutions on the share registry. Taking a look at our data on the ownership groups (below), it seems that institutions are noticeable on the share registry. Let's delve deeper into each type of owner, to discover more about Aston Martin Lagonda Global Holdings.

View our latest analysis for Aston Martin Lagonda Global Holdings

ownership-breakdown
LSE:AML Ownership Breakdown October 9th 2020

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

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

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

earnings-and-revenue-growth
LSE:AML Earnings and Revenue Growth October 9th 2020

Aston Martin Lagonda Global Holdings is not owned by hedge funds. From our data, we infer that the largest shareholder is Lawrence Stroll (who also holds the title of Top Key Executive) with 20% of shares outstanding. Its 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 play the role of a key stakeholder. InvestIndustrial is the second largest shareholder owning 7.1% of common stock, and Invesco Ltd. holds about 5.6% of the company stock.

A closer look at our ownership figures suggests that the top 13 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

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.

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 Aston Martin Lagonda Global Holdings plc. It has a market capitalization of just UK£926m, and insiders have UK£214m worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public holds a 32% stake in Aston Martin Lagonda Global Holdings. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

With an ownership of 7.1%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 8.0%, of the company's shares. 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

It appears to us that public companies own 4.1% of Aston Martin Lagonda Global Holdings. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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. Be aware that Aston Martin Lagonda Global Holdings is showing 4 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

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. 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.
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