Avacta Group Plc's (LON:AVCT) market cap touched UK£176m last week, benefiting both individual investors who own 57% as well as institutions

Key Insights

• Avacta Group's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 25 shareholders own 38% of the company
• 41% of Avacta Group is held by Institutions

Every investor in Avacta Group Plc (LON:AVCT) should be aware of the most powerful shareholder groups. With 57% stake, individual investors 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).

Individual investors gained the most after market cap touched UK£176m last week, while institutions who own 41% also benefitted.

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

See our latest analysis for Avacta Group

What Does The Institutional Ownership Tell Us About Avacta Group?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Avacta Group. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Avacta Group's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Avacta Group. Looking at our data, we can see that the largest shareholder is Jarvis Securities plc, Asset Management Arm with 6.4% of shares outstanding. With 6.2% and 4.2% of the shares outstanding respectively, HBOS Investment Fund Managers Limited and Barclays Bank PLC, Wealth and Investment Management Division are the second and third largest shareholders.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Avacta Group

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. 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.

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 Avacta Group Plc. It seems the board members have no more than UK£99k worth of shares in the UK£176m company. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 57% of Avacta Group. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - Avacta Group has 4 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

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.

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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.