Following a 43% decline over last year, recent gains may please Motorpoint Group Plc (LON:MOTR) institutional owners

Key Insights

• Significantly high institutional ownership implies Motorpoint Group's stock price is sensitive to their trading actions
• 53% of the business is held by the top 7 shareholders
• Insider ownership in Motorpoint Group is 15%

To get a sense of who is truly in control of Motorpoint Group Plc (LON:MOTR), it is important to understand the ownership structure of the business. We can see that institutions own the lion's share in the company with 55% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

After a year of 43% losses, last week’s 13% gain would be welcomed by institutional investors as a likely sign that returns might start trending higher.

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

See our latest analysis for Motorpoint Group

What Does The Institutional Ownership Tell Us About Motorpoint 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.

Motorpoint Group 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. 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 Motorpoint Group's earnings history below. Of course, the future is what really matters.

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Our data indicates that hedge funds own 9.5% of Motorpoint Group. 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. With a 10% stake, CEO Mark Carpenter is the largest shareholder. With 9.5% and 8.3% of the shares outstanding respectively, Immersion Capital LLP and UBS Asset Management AG are the second and third largest shareholders.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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

Insider Ownership Of Motorpoint 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. 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 information suggests that insiders maintain a significant holding in Motorpoint Group Plc. It has a market capitalization of just UK£97m, and insiders have UK£15m worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 11% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Motorpoint Group. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 8.5%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Motorpoint Group has 2 warning signs 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.