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Great week for Vistry Group PLC (LON:VTY) institutional investors after losing 26% over the previous year


Key Insights

  • Significantly high institutional ownership implies Vistry Group’s stock prices are sensitive to their trading actions.
  • The top 19 shareholders own 51% of the company
  • Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

Every investor in Vistry Group PLC (LON:VTY) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 61% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).

Institutional investors would probably welcome last week’s 8.2% increase in share prices after a year of 26% losses as a sign that returns are likely to begin trending higher.

Let’s take a closer look to see what the different types of shareholders can tell us about Vistry Group.

See our latest analysis for Vistry Group

LSE:VTY Ownership Breakdown January 19th 2023

What Does The Institutional Ownership Tell Us About Vistry Group?

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.

We can see that Vistry Group does have institutional investors; and they hold a good portion of the company’s stock. 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. 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 Vistry Group, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
LSE:VTY Earnings and Revenue Growth January 19th 2023

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Our data indicates that hedge funds own 13% of Vistry Group. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Browning West LP is currently the company’s largest shareholder with 7.7% of shares outstanding. Inclusive Capital Partners, L.P. is the second largest shareholder owning 5.8% of common stock, and BlackRock, Inc. holds about 5.0% of the company stock.

A closer look at our ownership figures suggests that the top 19 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Vistry Group

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.

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 Vistry Group PLC. The insiders have a meaningful stake worth UK£27m. Most would see this as a real positive. Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 24% stake in Vistry Group. 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 Vistry Group better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We’ve identified 2 warning signs with Vistry Group (at least 1 which is a bit concerning) , and understanding them should be part of your investment process.

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.

Valuation is complex, but we’re helping make it simple.

Find out whether Vistry Group is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis

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.



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