After losing 10.0% in the past year, Altisource Portfolio Solutions S.A. (NASDAQ:ASPS) institutional owners must be relieved by the recent gain

Key Insights

• Significantly high institutional ownership implies Altisource Portfolio Solutions' stock price is sensitive to their trading actions
• A total of 3 investors have a majority stake in the company with 52% ownership
• Recent purchases by insiders

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To get a sense of who is truly in control of Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 58% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Institutional investors would appreciate the 16% increase in share price last week, given their one-year losses have totalled a disappointing 10.0%.

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

See our latest analysis for Altisource Portfolio Solutions

What Does The Institutional Ownership Tell Us About Altisource Portfolio Solutions?

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 Altisource Portfolio Solutions. 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. 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 Altisource Portfolio Solutions' historic earnings and revenue below, but keep in mind there's always more to the story.

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. It would appear that 19% of Altisource Portfolio Solutions shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. UBS Asset Management AG is currently the company's largest shareholder with 22% of shares outstanding. With 16% and 14% of the shares outstanding respectively, Franklin Resources, Inc. and Deer Park Road Corporation are the second and third largest shareholders. Additionally, the company's CEO William Shepro directly holds 1.4% of the total shares outstanding.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Altisource Portfolio Solutions

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.

We can see that insiders own shares in Altisource Portfolio Solutions S.A.. In their own names, insiders own US$3.9m worth of stock in the US$111m company. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 19% stake in Altisource Portfolio Solutions. 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. To that end, you should learn about the 4 warning signs we've spotted with Altisource Portfolio Solutions (including 3 which don't sit too well with us) .

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.