With 51% ownership, BrightSpire Capital, Inc. (NYSE:BRSP) boasts of strong institutional backing
editorial-team@simplywallst.com (Simply Wall St)
4 min read
Key Insights
Significantly high institutional ownership implies BrightSpire Capital's stock price is sensitive to their trading actions
A total of 22 investors have a majority stake in the company with 50% ownership
Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock
Every investor in BrightSpire Capital, Inc. (NYSE:BRSP) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 51% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence on its future.
In the chart below, we zoom in on the different ownership groups of BrightSpire Capital.
What Does The Institutional Ownership Tell Us About BrightSpire Capital?
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 BrightSpire Capital 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 BrightSpire Capital, (below). Of course, keep in mind that there are other factors to consider, too.
NYSE:BRSP Earnings and Revenue Growth November 22nd 2023
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. It looks like hedge funds own 8.5% of BrightSpire Capital shares. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc. with 9.6% of shares outstanding. Nut Tree Capital Management, LP is the second largest shareholder owning 8.5% of common stock, and BlackRock, Inc. holds about 8.2% of the company stock. In addition, we found that Michael Mazzei, the CEO has 0.9% of the shares allocated to their name.
A closer look at our ownership figures suggests that the top 22 shareholders have a combined ownership of 50% 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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of BrightSpire Capital
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.
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 most recent data indicates that insiders own some shares in BrightSpire Capital, Inc.. It has a market capitalization of just US$855m, and insiders have US$17m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, who are usually individual investors, hold a 38% stake in BrightSpire Capital. 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.
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.
