European Residential Real Estate Investment Trust (TSE:ERE.UN) most popular amongst individual investors who own 61% of the shares, institutions hold 37%
Simply Wall St
4 min read
Every investor in European Residential Real Estate Investment Trust (TSE:ERE.UN) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 61% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And institutions on the other hand have a 37% ownership in the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.
In the chart below, we zoom in on the different ownership groups of European Residential Real Estate Investment Trust.
TSX:ERE.UN Ownership Breakdown September 18th 2022
What Does The Institutional Ownership Tell Us About European Residential Real Estate Investment Trust?
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.
We can see that European Residential Real Estate Investment Trust does have institutional investors; and they hold a good portion of the company's stock. 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. 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 European Residential Real Estate Investment Trust, (below). Of course, keep in mind that there are other factors to consider, too.
TSX:ERE.UN Earnings and Revenue Growth September 18th 2022
Hedge funds don't have many shares in European Residential Real Estate Investment Trust. Our data shows that 1832 Asset Management L.P. is the largest shareholder with 15% of shares outstanding. For context, the second largest shareholder holds about 11% of the shares outstanding, followed by an ownership of 4.2% by the third-largest shareholder. In addition, we found that Phillip Burns, the CEO has 1.0% of the shares allocated to their name.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
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 European Residential Real Estate Investment Trust
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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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 European Residential Real Estate Investment Trust. As individuals, the insiders collectively own CA$14m worth of the CA$760m 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 -- including retail investors -- own 61% of European Residential Real Estate Investment Trust. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand European Residential Real Estate Investment Trust better, we need to consider many other factors. Take risks for example - European Residential Real Estate Investment Trust has 4 warning signs (and 2 which don't sit too well with us) we think you should know about.
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.
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