Institutional investors control 63% of Judges Scientific plc (LON:JDG) and were rewarded last week after stock increased 11%

Key Insights

• Significantly high institutional ownership implies Judges Scientific's stock price is sensitive to their trading actions
• A total of 21 investors have a majority stake in the company with 51% ownership
• Insiders have been selling lately

If you want to know who really controls Judges Scientific plc (LON:JDG), then you'll have to look at the makeup of its share registry. With 63% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, institutional investors ended up benefitting the most after the company hit UK£541m in market cap. One-year return to shareholders is currently 17% and last week’s gain was the icing on the cake.

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

View our latest analysis for Judges Scientific

What Does The Institutional Ownership Tell Us About Judges Scientific?

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 Judges Scientific. 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 Judges Scientific's historic earnings and revenue below, but keep in mind there's always more to the story.

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Judges Scientific is not owned by hedge funds. Our data shows that ODIN Forvaltning AS is the largest shareholder with 6.2% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.9% and 4.2%, of the shares outstanding, respectively. Additionally, the company's CEO David Cicurel directly holds 1.0% of the total shares outstanding.

After doing some more digging, we found that the top 21 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.

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 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 Judges Scientific

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our most recent data indicates that insiders own some shares in Judges Scientific plc. As individuals, the insiders collectively own UK£21m worth of the UK£541m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 26% stake in Judges Scientific. 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 a stake of 5.9%, private equity firms could influence the Judges Scientific board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Judges Scientific better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 4 warning signs for Judges Scientific you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.