Institutional investors must be pleased after a 12% gain last week that adds to BATM Advanced Communications Ltd.'s (LON:BVC) one-year returns

Key Insights

• Significantly high institutional ownership implies BATM Advanced Communications' stock price is sensitive to their trading actions
• 51% of the business is held by the top 2 shareholders
• Insiders own 23% of BATM Advanced Communications

If you want to know who really controls BATM Advanced Communications Ltd. (LON:BVC), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 42% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).

Last week’s 12% gain means that institutional investors were on the positive end of the spectrum even as the company has shown strong longer-term trends. The one-year return on investment is currently 5.4% and last week's gain would have been more than welcomed.

Let's delve deeper into each type of owner of BATM Advanced Communications, beginning with the chart below.

View our latest analysis for BATM Advanced Communications

What Does The Institutional Ownership Tell Us About BATM Advanced Communications?

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 BATM Advanced Communications 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 BATM Advanced Communications' historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in BATM Advanced Communications. The company's largest shareholder is Lombard Odier Asset Management (Europe) Ltd., with ownership of 29%. Zvi Marom is the second largest shareholder owning 22% of common stock, and Herald Investment Management Ltd. holds about 4.2% of the company stock. Zvi Marom, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of BATM Advanced Communications

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 most recent data indicates that insiders own a reasonable proportion of BATM Advanced Communications Ltd.. Insiders have a UK£29m stake in this UK£127m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 35% ownership, the general public, mostly comprising of individual investors, have some degree of sway over BATM Advanced Communications. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand BATM Advanced Communications better, we need to consider many other factors. Be aware that BATM Advanced Communications is showing 2 warning signs in our investment analysis , you should know about...

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.