Public companies who have a significant stake must be disappointed along with institutions after Barnes & Noble Education, Inc.'s (NYSE:BNED) market cap dropped by US$45m

Key Insights

• Significant control over Barnes & Noble Education by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 3 shareholders own 54% of the company
• Institutional ownership in Barnes & Noble Education is 29%

To get a sense of who is truly in control of Barnes & Noble Education, Inc. (NYSE:BNED), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are public companies with 36% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 13% decrease in the stock price last week, public companies suffered the most losses, but institutions who own 29% stock also took a hit.

Let's delve deeper into each type of owner of Barnes & Noble Education, beginning with the chart below.

Check out our latest analysis for Barnes & Noble Education

What Does The Institutional Ownership Tell Us About Barnes & Noble Education?

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 Barnes & Noble Education. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Barnes & Noble Education, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Barnes & Noble Education. Looking at our data, we can see that the largest shareholder is Immersion Corporation with 36% of shares outstanding. With 9.8% and 7.7% of the shares outstanding respectively, TopLids LendCo, LLC and Kanen Wealth Management LLC are the second and third largest shareholders. In addition, we found that Jonathan Shar, the CEO has 1.2% of the shares allocated to their name.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.

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. 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 Barnes & Noble Education

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Shareholders would probably be interested to learn that insiders own shares in Barnes & Noble Education, Inc.. It has a market capitalization of just US$304m, and insiders have US$19m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a 19% stake in Barnes & Noble Education. 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 Company Ownership

We can see that Private Companies own 9.9%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Public Company Ownership

It appears to us that public companies own 36% of Barnes & Noble Education. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Barnes & Noble Education better, we need to consider many other factors. Take risks for example - Barnes & Noble Education has 3 warning signs (and 2 which don't sit too well with us) we think you should know about.

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.