The considerable ownership by public companies in Barnes & Noble Education indicates that they collectively have a greater say in management and business strategy
To get a sense of who is truly in control of Barnes & Noble Education, Inc. (NYSE:BNED), it is important to understand the ownership structure of the business. We can see that public companies own the lion's share in the company with 42% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Clearly, public companies benefitted the most after the company's market cap rose by US$94m last week.
Let's take a closer look to see what the different types of shareholders can tell us about Barnes & Noble Education.
What Does The Institutional Ownership Tell Us About Barnes & Noble Education?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
As you can see, institutional investors have a fair amount of stake in Barnes & Noble Education. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Barnes & Noble Education's historic earnings and revenue below, but keep in mind there's always more to the story.
NYSE:BNED Earnings and Revenue Growth November 10th 2024
It looks like hedge funds own 7.9% of Barnes & Noble Education shares. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Immersion Corporation is currently the company's largest shareholder with 42% of shares outstanding. Outerbridge Capital Management, LLC is the second largest shareholder owning 7.9% of common stock, and Kanen Wealth Management LLC holds about 6.0% of the company stock. Additionally, the company's CEO Jonathan Shar directly holds 1.4% of the total shares outstanding.
To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.
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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Barnes & Noble Education
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
We can report that insiders do own shares in Barnes & Noble Education, Inc.. As individuals, the insiders collectively own US$11m worth of the US$331m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public, who are usually individual investors, hold a 38% stake in Barnes & Noble Education. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Public Company Ownership
Public companies currently own 42% of Barnes & Noble Education stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.
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. Case in point: We've spotted 3 warning signs for Barnes & Noble Education you should be aware of, and 2 of them are significant.
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.
