With 66% ownership in Electrolux Professional AB (publ) (STO:EPRO B), institutional investors have a lot riding on the business

Key Insights

• Significantly high institutional ownership implies Electrolux Professional's stock price is sensitive to their trading actions
• 53% of the business is held by the top 6 shareholders
• Insiders have been buying lately

If you want to know who really controls Electrolux Professional AB (publ) (STO:EPRO B), then you'll have to look at the makeup of its share registry. With 66% stake, institutions possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And as as result, institutional investors reaped the most rewards after the company's stock price gained 3.5% last week. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 20%.

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

View our latest analysis for Electrolux Professional

What Does The Institutional Ownership Tell Us About Electrolux Professional?

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.

As you can see, institutional investors have a fair amount of stake in Electrolux Professional. 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 Electrolux Professional'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. Electrolux Professional is not owned by hedge funds. Investor AB (publ) is currently the company's largest shareholder with 21% of shares outstanding. Swedbank Robur Fonder AB is the second largest shareholder owning 10% of common stock, and Alecta Pensionsförsäkring, ömsesidigt holds about 7.1% of the company stock.

We did some more digging and found that 6 of the top shareholders account for roughly 53% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Electrolux Professional

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. 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 most recent data indicates that insiders own less than 1% of Electrolux Professional AB (publ). It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own kr36m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 13% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Electrolux Professional. 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 Equity Ownership

With a stake of 21%, private equity firms could influence the Electrolux Professional board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Electrolux Professional better, we need to consider many other factors. For instance, we've identified 1 warning sign for Electrolux Professional that you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.