Recent uptick might appease abrdn plc (LON:ABDN) institutional owners after losing 0.8% over the past year

Key Insights

• Given the large stake in the stock by institutions, abrdn's stock price might be vulnerable to their trading decisions
• The top 25 shareholders own 49% of the company
• Recent purchases by insiders

Every investor in abrdn plc (LON:ABDN) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Institutional investors would probably welcome last week's 5.3% increase in share prices after a year of 0.8% losses as a sign that returns are likely to begin trending higher.

Let's take a closer look to see what the different types of shareholders can tell us about abrdn.

Check out our latest analysis for abrdn

What Does The Institutional Ownership Tell Us About abrdn?

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.

abrdn already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 abrdn, (below). Of course, keep in mind that there are other factors to consider, too.

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. abrdn is not owned by hedge funds. Silchester International Investors LLP is currently the company's largest shareholder with 9.7% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.2% and 5.4% of the stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of abrdn

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.

Our most recent data indicates that insiders own less than 1% of abrdn plc. Keep in mind that it's a big company, and the insiders own UK£2.2m worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 45% 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand abrdn better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for abrdn you should be aware of.

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.

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.