Retail investors who hold 40% of VIGO Photonics S.A. (WSE:VGO) gained 13%, institutions profited as well

Key Insights

• VIGO Photonics' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 51% of the business is held by the top 10 shareholders
• Insider ownership in VIGO Photonics is 21%

To get a sense of who is truly in control of VIGO Photonics S.A. (WSE:VGO), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are retail investors with 40% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Retail investors gained the most after market cap touched zł499m last week, while institutions who own 24% also benefitted.

In the chart below, we zoom in on the different ownership groups of VIGO Photonics.

Check out our latest analysis for VIGO Photonics

What Does The Institutional Ownership Tell Us About VIGO Photonics?

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.

As you can see, institutional investors have a fair amount of stake in VIGO Photonics. 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 VIGO Photonics' 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 VIGO Photonics. Warsaw Equity Group is currently the company's largest shareholder with 14% of shares outstanding. With 9.7% and 5.5% of the shares outstanding respectively, Józef Piotrowski and Janusz Kubrak are the second and third largest shareholders. Janusz Kubrak, who is the third-largest shareholder, also happens to hold the title of Member of Supervisory Board.

We did some more digging and found that 10 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 VIGO Photonics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own a reasonable proportion of VIGO Photonics S.A.. Insiders own zł105m worth of shares in the zł499m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 40% 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.

Private Equity Ownership

Private equity firms hold a 14% stake in VIGO Photonics. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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 instance, we've identified 2 warning signs for VIGO Photonics that you should be aware of.

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.