How Much Of A.G. BARR p.l.c. (LON:BAG) Do Insiders Own?

Simply Wall St

Thu, Apr 21, 2022, 5:55 AM 4 min read

The big shareholder groups in A.G. BARR p.l.c. (LON:BAG) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

A.G. BARR is a smaller company with a market capitalization of UK£603m, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about A.G. BARR.

See our latest analysis for A.G. BARR

ownership-breakdown — LSE:BAG Ownership Breakdown April 21st 2022

What Does The Institutional Ownership Tell Us About A.G. BARR?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

A.G. BARR already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 A.G. BARR, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth — LSE:BAG Earnings and Revenue Growth April 21st 2022

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. A.G. BARR is not owned by hedge funds. Our data shows that William Robin Barr is the largest shareholder with 15% of shares outstanding. Lindsell Train Limited is the second largest shareholder owning 11% of common stock, and Rathbone Investment Management Limited holds about 5.0% of the company stock.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of A.G. BARR

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own a reasonable proportion of A.G. BARR p.l.c.. Insiders have a UK£96m stake in this UK£603m business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand A.G. BARR better, we need to consider many other factors. For instance, we've identified 1 warning sign for A.G. BARR that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.