Yahoo Finance AEW UK REIT plc (LON:AEWU) is favoured by institutional owners who hold 59% of the company
Key Insights
Given the large stake in the stock by institutions, AEW UK REIT's stock price might be vulnerable to their trading decisions
49% of the business is held by the top 25 shareholders
Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock
A look at the shareholders of AEW UK REIT plc (LON:AEWU) can tell us which group is most powerful. With 59% stake, institutions possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
Let's take a closer look to see what the different types of shareholders can tell us about AEW UK REIT.
Check out our latest analysis for AEW UK REIT
What Does The Institutional Ownership Tell Us About AEW UK REIT?
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.
AEW UK REIT already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 AEW UK REIT's earnings history below. Of course, the future is what really matters.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Hedge funds don't have many shares in AEW UK REIT. Looking at our data, we can see that the largest shareholder is A J Bell Holdings Limited, Asset Management Arm with 5.8% of shares outstanding. The second and third largest shareholders are Momentum Global Investment Management Ltd. and Close Asset Management Ltd., with an equal amount of shares to their name at 5.0%.
Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
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. 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 AEW UK REIT
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 information suggests that AEW UK REIT plc insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. It appears that the board holds about UK£732k worth of stock. This compares to a market capitalization of UK£156m. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.
General Public Ownership
With a 37% ownership, the general public, mostly comprising of individual investors, have some degree of sway over AEW UK REIT. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For example, we've discovered 1 warning sign for AEW UK REIT that you should be aware of before investing here.
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.
