Institutional investors have a lot riding on Tejon Ranch Co. (NYSE:TRC) with 46% ownership

Key Insights

• Institutions' substantial holdings in Tejon Ranch implies that they have significant influence over the company's share price
• 52% of the business is held by the top 13 shareholders
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Tejon Ranch Co. (NYSE:TRC), 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 46% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And things are looking up for institutional investors after the company gained US$63m in market cap last week. The one-year return on investment is currently 12% and last week's gain would have been more than welcomed.

In the chart below, we zoom in on the different ownership groups of Tejon Ranch.

Check out our latest analysis for Tejon Ranch

What Does The Institutional Ownership Tell Us About Tejon Ranch?

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 Tejon Ranch. 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. 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 Tejon Ranch's earnings history below. Of course, the future is what really matters.

It looks like hedge funds own 14% of Tejon Ranch shares. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. TowerView LLC is currently the company's largest shareholder with 14% of shares outstanding. For context, the second largest shareholder holds about 6.1% of the shares outstanding, followed by an ownership of 5.3% by the third-largest shareholder. Additionally, the company's CEO Gregory Bielli directly holds 1.7% of the total shares outstanding.

After doing some more digging, we found that the top 13 have the combined ownership of 52% in the company, suggesting that no single shareholder has significant control over 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Tejon Ranch

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.

We can see that insiders own shares in Tejon Ranch Co.. In their own names, insiders own US$38m worth of stock in the US$491m company. Some would say this shows alignment of interests between shareholders and the board. 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 32% stake in Tejon Ranch. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Tejon Ranch better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Tejon Ranch .

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.

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