Yahoo Finance AEW UK REIT plc (LON:AEWU) is favoured by institutional owners who hold 60% of the company
Key Insights
Significantly high institutional ownership implies AEW UK REIT's stock price is sensitive to their trading actions
The top 25 shareholders own 50% of the company
Past performance of a company along with ownership data serve to give a strong idea about prospects for a business
Every investor in AEW UK REIT plc (LON:AEWU) should be aware of the most powerful shareholder groups. With 60% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
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. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's take a closer look to see what the different types of shareholders can tell us about AEW UK REIT.
View our latest analysis for AEW UK REIT
What Does The Institutional Ownership Tell Us About AEW UK REIT?
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.
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. 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 AEW UK REIT, (below). Of course, keep in mind that there are other factors to consider, too.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. 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 6.1% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.9% and 4.5%, of the shares outstanding, respectively.
A closer look at our ownership figures suggests that the top 25 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.
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 AEW UK REIT
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.
Our most recent data indicates that insiders own less than 1% of AEW UK REIT plc. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It has a market capitalization of just UK£140m, and the board has only UK£659k worth of shares in their own names. 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 36% ownership, the general public, mostly comprising of individual investors, have some degree of sway over AEW UK REIT. 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 AEW UK REIT better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with AEW UK REIT .
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.
