AUTO1 Group SE (ETR:AG1) has attracted the attention of institutional investors who hold a significant 39% stake

Key ideas

• The significant holdings of institutions in the AUTO1 group imply that they have a significant influence on the company’s share price

• In total, 4 investors hold a majority stake in the company with a 52% stake.

• Analyst forecasts along with ownership data are used to provide a clear picture of a company’s prospects.

A look at AUTO1 Group SE (ETR:AG1) shareholders can tell us which group is more powerful. With 39% of the capital, institutions hold the largest number of shares in the company. In other words, the group is the one that has the most to gain (or lose) from its investment in society.

Institutional investors have a large pool of resources and liquidity, and their investment decisions therefore tend to carry significant weight, particularly among individual investors. This is why it is often considered desirable to have a significant amount of institutional money invested in a company.

In the graph below, we zoom in on the different ownership groups of the AUTO1 Group.

Check out our latest analysis for AUTO1 Group

What does institutional ownership tell us about the AUTO1 group?

Institutional investors typically compare their own returns to those of a benchmark index. They therefore typically consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors hold a significant stake in the AUTO1 group. This suggests a certain credibility among professional investors. But we can’t rely on that fact alone, because institutions make bad investments sometimes, just like everyone else. It is not uncommon to see a big drop in stock price if two large institutional investors try to sell out of a stock at the same time. So it’s worth checking AUTO1 Group’s past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.

We note that hedge funds do not have any significant investment in AUTO1 Group. The company’s largest shareholder is SoftBank Investment Advisers (UK) Limited, with a 17% stake. The second and third largest shareholders are Hkvv GmbH and Bm Digital Gmbh, with an equal number of shares to their name, i.e. 13%.

Looking further, we found that 52% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a say in the company’s decisions.

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 can be useful to know their aggregate view on the future.

The story continues

Internal property of the AUTO1 group

The definition of an insider may vary slightly from country to country, but board members always count. The company’s management runs the business, but the CEO is accountable to the board, even if he or she is a board member.

I generally consider insider ownership to be a good thing. However, in some cases it makes it more difficult for other shareholders to hold the board accountable for its decisions.

Our most recent data indicates that insiders own shares of AUTO1 Group SE. This is a fairly large undertaking, so it’s generally positive to see potentially meaningful alignment. In this case, they hold around €106 million worth of shares (at current prices). It’s good to see this level of investment from insiders. You can check here to see if these insiders have purchased recently.

General public property

The general public, including retail investors, owns 11% of the company’s shares and therefore cannot be easily ignored. While this group can’t necessarily make the decisions, they can certainly have a real influence on how the business is run.

Private Equity Ownership

With a 17% stake, private equity firms could influence the board of AUTO1 Group. You sometimes see private equity firms registering for the long term, but in general, they have a shorter investment horizon and, as their name suggests, do not invest much in listed companies. After a while, they could consider selling and redeploying capital elsewhere.

Private company ownership

It appears that private companies hold 25% of the shares in AUTO1 Group. Private companies may be related parties. Sometimes insiders have an interest in a public company through a shareholding in a private company, rather than in their own capacity as an individual. Although it is difficult to draw general conclusions, it is worth noting this as an area for further research.

Next steps:

While it is worth considering the different groups that own a business, there are other factors that are even more important. Take, for example, the ever-present specter of investment risk. We have identified 1 warning sign with the AUTO1 Group, and understanding them should be part of your investment process.

If you’d rather find out what analysts are predicting for future growth, don’t miss this free analyst forecast report.

NB: The figures in this article are calculated from the last twelve months data, which refers to the 12-month period ending on the last day of the month in which the financial statement is issued. These figures may not correspond to the figures in the annual report for the full year.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to constitute financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. Our goal is to provide you with focused, long-term analysis based on fundamental data. Please note that our analysis may not factor in the latest price-sensitive company announcements or qualitative information. Simply Wall St has no position in any of the stocks mentioned.

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