BBGI Global Infrastructure S.A.'s (LON:BBGI) market cap decline of UK£54m may not have as much of an impact on institutional owners after a year of 2.4% returns

By
Simply Wall St
Published
January 12, 2022
LSE:BBGI
Source: Shutterstock

Every investor in BBGI Global Infrastructure S.A. (LON:BBGI) should be aware of the most powerful shareholder groups. With 52% stake, institutions possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

No shareholder likes losing money on their investments, especially institutional investors who saw their holdings drop 4.2% in value last week. Still, the 2.4% one-year gains may have helped mitigate their overall losses. We would assume however, that they would be on the lookout for weakness in the future.

Let's delve deeper into each type of owner of BBGI Global Infrastructure, beginning with the chart below.

See our latest analysis for BBGI Global Infrastructure

ownership-breakdown
LSE:BBGI Ownership Breakdown January 12th 2022

What Does The Institutional Ownership Tell Us About BBGI Global Infrastructure?

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 BBGI Global Infrastructure 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. 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 BBGI Global Infrastructure, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
LSE:BBGI Earnings and Revenue Growth January 12th 2022

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. BBGI Global Infrastructure is not owned by hedge funds. M&G Investment Management Limited is currently the company's largest shareholder with 8.4% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.9% and 5.6% of the stock.

After doing some more digging, we found that the top 19 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of BBGI Global Infrastructure

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.

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 most recent data indicates that insiders own less than 1% of BBGI Global Infrastructure S.A.. Keep in mind that it's a big company, and the insiders own UK£3.1m worth of shares. The absolute value might be more important than the proportional share. 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, who are usually individual investors, hold a 48% stake in BBGI Global Infrastructure. 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 BBGI Global Infrastructure better, we need to consider many other factors. Take risks for example - BBGI Global Infrastructure has 3 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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