Recent uptick might appease Selvita S.A. (WSE:SLV) institutional owners after losing 40% over the past year

Key Insights

• Institutions' substantial holdings in Selvita implies that they have significant influence over the company's share price
• The top 6 shareholders own 53% of the company
• Insider ownership in Selvita is 24%

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To get a sense of who is truly in control of Selvita S.A. (WSE:SLV), 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 54% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Institutional investors would appreciate the 14% increase in share price last week, given their one-year losses have totalled a disappointing 40%.

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

Check out our latest analysis for Selvita

What Does The Institutional Ownership Tell Us About Selvita?

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 Selvita. 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. 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 Selvita'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. We note that hedge funds don't have a meaningful investment in Selvita. Pawel Przewiezlikowski is currently the company's largest shareholder with 17% of shares outstanding. Towarzystwo Funduszy Inwestycyjnych Allianz Polska S.A. is the second largest shareholder owning 11% of common stock, and Nationale-Nederlanden Powszechne Towarzystwo Emerytalne S.A. holds about 10% of the company stock. Furthermore, CEO Boguslaw Sieczkowski is the owner of 5.1% of the company's shares.

We also observed that the top 6 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 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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Selvita

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. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Selvita S.A.. Insiders have a zł170m stake in this zł705m 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

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 1 warning sign for Selvita that you should be aware of before investing here.

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.