Institutional investors have a lot riding on VEF AB (publ) (STO:VEFAB) with 49% ownership

Key Insights

• Institutions' substantial holdings in VEF implies that they have significant influence over the company's share price
• The top 5 shareholders own 55% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

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Every investor in VEF AB (publ) (STO:VEFAB) should be aware of the most powerful shareholder groups. With 49% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And as as result, institutional investors reaped the most rewards after the company's stock price gained 11% last week. One-year return to shareholders is currently 13% and last week’s gain was the icing on the cake.

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

See our latest analysis for VEF

What Does The Institutional Ownership Tell Us About VEF?

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.

VEF already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 VEF's earnings history below. Of course, the future is what really matters.

Our data indicates that hedge funds own 30% of VEF. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. The company's largest shareholder is Conifer Management, LLC, with ownership of 21%. In comparison, the second and third largest shareholders hold about 9.9% and 8.9% of the stock. Furthermore, CEO David Nangle is the owner of 2.0% of the company's shares.

On looking further, we found that 55% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of VEF

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.

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 some shares in VEF AB (publ). It has a market capitalization of just kr2.5b, and insiders have kr54m worth of shares, in their own names. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 18% 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we've spotted with VEF .

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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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.