Stock Analysis

Do Institutions Own Mondi plc (LON:MNDI) Shares?

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LSE:MNDI
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If you want to know who really controls Mondi plc (LON:MNDI), then you'll have to look at the makeup of its share registry. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Companies that have been privatized tend to have low insider ownership.

Mondi has a market capitalization of UK£7.1b, so it's too big to fly under the radar. We'd expect to see both institutions and retail investors owning a portion of the company. In the chart below, we can see that institutions own shares in the company. Let's delve deeper into each type of owner, to discover more about Mondi.

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ownership-breakdown
LSE:MNDI Ownership Breakdown July 14th 2020

What Does The Institutional Ownership Tell Us About Mondi?

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 Mondi. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Mondi's earnings history, below. Of course, the future is what really matters.

earnings-and-revenue-growth
LSE:MNDI Earnings and Revenue Growth July 14th 2020

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Mondi is not owned by hedge funds. BlackRock, Inc. is currently the company's largest shareholder with 7.0% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.2% and 3.3% of the stock.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 Mondi

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. 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.

Our most recent data indicates that insiders own less than 1% of Mondi plc. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own UK£2.8m of stock. 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, with a 29% stake in the company, will not 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 Mondi better, we need to consider many other factors. Be aware that Mondi is showing 2 warning signs in our investment analysis , you should know about...

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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