Institutions along with individual investors who hold considerable shares inStellantis N.V. (BIT:STLA) come under pressure; lose 3.9% of holdings value

By
Simply Wall St
Published
February 23, 2022
BIT:STLA
Source: Shutterstock

To get a sense of who is truly in control of Stellantis N.V. (BIT:STLA), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 36% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions who own 31% came under pressure after market cap dropped to €51b last week,individual investors took the most losses.

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

View our latest analysis for Stellantis

ownership-breakdown
BIT:STLA Ownership Breakdown February 23rd 2022

What Does The Institutional Ownership Tell Us About Stellantis?

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.

Stellantis 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Stellantis, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
BIT:STLA Earnings and Revenue Growth February 23rd 2022

We note that hedge funds don't have a meaningful investment in Stellantis. Our data shows that Giovanni Agnelli B.V. is the largest shareholder with 14% of shares outstanding. Etablissements Peugeot Freres SA is the second largest shareholder owning 7.2% of common stock, and Bpifrance Participations SA holds about 6.2% of the company stock.

After doing some more digging, we found that the top 15 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.

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 Stellantis

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 data suggests that insiders own under 1% of Stellantis N.V. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own €28m of stock. In this sort of situation, it can be more interesting to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 36% stake in the company, and hence can't 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.

Private Equity Ownership

With an ownership of 6.2%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Private Company Ownership

It seems that Private Companies own 26%, of the Stellantis stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

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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