Springfield Properties Plc (LON:SPR) has caught the attention of institutional investors who hold a sizeable 34% stake

Key insights

Every investor in Springfield Properties Plc (LON:SPR) should be aware of the most powerful shareholder groups. The group that holds the largest number of shares in the company, around 34% to be precise, are institutions. Put another way, the group faces maximum upside potential (or downside risk).

Given the vast amount of money and research capabilities at its disposal, institutional ownership tends to carry a lot of weight, especially among individual investors. Thus, having a considerable amount of institutional money invested in a company is often considered a desirable characteristic.

Let’s dive deeper into each type of owner at Springfield Properties, starting with the chart below.

Check out our latest analysis for Springfield Properties

What does institutional ownership tell us about Springfield properties?

Institutional investors often compare their own returns to the returns of a commonly followed index. Therefore, they often consider buying larger companies included in the relevant benchmark index.

As you can see, institutional investors have a decent stake in Springfield Properties. This implies that the analysts working for these institutions have looked at the stock and like it. But just like anyone else, they can be wrong. When multiple institutions own shares, there is always a risk that they are in a “crowded trade”. When such a trade goes wrong, multiple parties may compete to sell shares quickly. This risk is greater in a company without a history of growth. You can see Springfield Properties’ historical earnings and revenue below, but keep in mind there’s always more to the story.

We note that hedge funds do not have a significant investment in Springfield Properties. Our data suggests that Alexander Adam, who is also the company’s chief executive, holds the most shares at 23%. When an insider owns a considerable amount of shares in a company, investors consider this a positive sign because it suggests that the insiders are willing to have their wealth tied to the company’s future. James Adam is the second largest shareholder, owning 7.9% of the common shares, and BGF Investment Management Ltd. holds about 7.7% of the company’s shares. Furthermore, the company’s CEO, Innes Smith, directly owns 0.8% of the total outstanding shares.

We also observed that the top 6 shareholders represent more than half of the share register, with some smaller shareholders balancing, to some extent, the interests of the larger ones.

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. Many analysts cover the stock, so you can easily analyze its forecast growth.

Prime Ownership of Springfield Properties

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company’s management reports to the board and the board must represent the interests of the shareholders. Notably, sometimes top managers themselves sit on the board.

Most consider insider ownership to be a positive factor because it can indicate that the board is well aligned with other shareholders. However, on some occasions, too much power is concentrated in this group.

Our latest data indicates that insiders own a fair proportion of Springfield Properties Plc. Insiders own £39m worth of shares in the £123m company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if these insiders are buying or selling.

General Public Property

The general public, who are generally individual investors, holds a 26% stake in Springfield Properties. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.

Private equity ownership

With a 7.7% stake, private equity firms are in a position to play a role in defining business strategy with a focus on value creation. Some investors may be encouraged by this, as private equity is sometimes able to encourage strategies that help the market see the value of the company. Alternatively, these holders can exit the investment after taking it public.

Next steps:

While it is worth considering the different groups that own a business, there are other factors that are even more important.

I like to dive deeper about a company’s past performance. You can find historical revenue and earnings in this detailed chart.

Ultimately the future is the most important. You can access this free report on analyst forecasts for the company.

Note: The values ​​in this article are calculated based on data from the last twelve months, which refer to the 12-month period ending on the last date of the month in which the financial statements are dated. This may not be consistent with the figures in the full annual report.

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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 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 into account your objectives or financial situation. Our goal is to bring you long-term focused analysis driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Simply Wall St has no position in any of the stocks mentioned.