Institutions own 27% of Grit Real Estate Income Group Limited (LON:GR1T) shares but retail investors control 38% of the company

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Simply Wall St

Sun, Sep 17, 2023, 1:56 AM 4 min read

Every investor in Grit Real Estate Income Group Limited (LON:GR1T) should be aware of the most powerful shareholder groups. With 38% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And institutions on the other hand have a 27% ownership in the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.

Let's delve deeper into each type of owner of Grit Real Estate Income Group, beginning with the chart below.

See our latest analysis for Grit Real Estate Income Group

ownership-breakdown — LSE:GR1T Ownership Breakdown September 17th 2023

What Does The Institutional Ownership Tell Us About Grit Real Estate Income Group?

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 Grit Real Estate Income Group does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Grit Real Estate Income Group, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth — LSE:GR1T Earnings and Revenue Growth September 17th 2023

We note that hedge funds don't have a meaningful investment in Grit Real Estate Income Group. Looking at our data, we can see that the largest shareholder is Public Investment Corporation Limited with 22% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.3% and 6.9%, of the shares outstanding, respectively. Furthermore, CEO Bronwyn Knight is the owner of 2.7% of the company's shares.

On further inspection, we found that more than half the company's shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Grit Real Estate Income Group

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 Grit Real Estate Income Group Limited. In their own names, insiders own UK£12m worth of stock in the UK£156m company. This shows at least some alignment, but we usually like to see larger insider holdings. 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 38% stake in Grit Real Estate Income Group. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 5.5%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Grit Real Estate Income Group has 4 warning signs (and 2 which don't sit too well with us) we think you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.