Both retail investors who control a good portion of Yellow Cake plc (LON:YCA) along with institutions must be dismayed after last week's 12% decrease

Key Insights

• Yellow Cake's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 50% of the business is held by the top 13 shareholders
• Institutional ownership in Yellow Cake is 45%

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If you want to know who really controls Yellow Cake plc (LON:YCA), 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 retail investors with 46% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions, who own 45% shares weren’t spared from last week’s UK£165m market cap drop, retail investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of Yellow Cake.

View our latest analysis for Yellow Cake

What Does The Institutional Ownership Tell Us About Yellow Cake?

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 Yellow Cake does have institutional investors; and they hold a good portion of the company's stock. 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 Yellow Cake's historic earnings and revenue below, but keep in mind there's always more to the story.

It looks like hedge funds own 9.0% of Yellow Cake shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. MM Asset Management Inc is currently the largest shareholder, with 9.0% of shares outstanding. Van Eck Associates Corporation is the second largest shareholder owning 8.0% of common stock, and Plenisfer Investments SGR S.p.A. holds about 5.5% of the company stock.

After doing some more digging, we found that the top 13 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Yellow Cake

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

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 data suggests that insiders own under 1% of Yellow Cake plc in their own names. Keep in mind that it's a big company, and the insiders own UK£1.6m worth of shares. The absolute value might be more important than the proportional share. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Yellow Cake. 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 Yellow Cake better, we need to consider many other factors. Take risks for example - Yellow Cake has 1 warning sign we think you should be aware of.

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. 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.