Institutional owners may ignore Coca-Cola Consolidated, Inc.'s (NASDAQ:COKE) recent US$650m market cap decline as longer-term profits stay in the green
If you want to know who really controls Coca-Cola Consolidated, Inc. (NASDAQ:COKE), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 46% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Institutional investors endured the highest losses after the company's market cap fell by US$650m last week. However, the 91% one-year return to shareholders may have helped lessen their pain. They should, however, be mindful of further losses in the future.
Let's take a closer look to see what the different types of shareholders can tell us about Coca-Cola Consolidated.
NasdaqGS:COKE Ownership Breakdown October 31st 2024
What Does The Institutional Ownership Tell Us About Coca-Cola Consolidated?
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.
As you can see, institutional investors have a fair amount of stake in Coca-Cola Consolidated. 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. 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 Coca-Cola Consolidated's historic earnings and revenue below, but keep in mind there's always more to the story.
NasdaqGS:COKE Earnings and Revenue Growth October 31st 2024
Coca-Cola Consolidated is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is The Coca-Cola Company with 22% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 11% and 6.4%, of the shares outstanding, respectively. J. Harrison, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.
We also observed that the top 6 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Coca-Cola Consolidated
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.
Our information suggests that insiders maintain a significant holding in Coca-Cola Consolidated, Inc.. Insiders own US$2.0b worth of shares in the US$11b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 14% stake in Coca-Cola Consolidated. 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
We can see that public companies hold 22% of the Coca-Cola Consolidated shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Coca-Cola Consolidated better, we need to consider many other factors. For instance, we've identified 1 warning sign for Coca-Cola Consolidated that you should be aware of.
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.
