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Every investor in Peet Limited (ASX:PPC) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's delve deeper into each type of owner of Peet, beginning with the chart below.
Check out our latest analysis for Peet
What Does The Institutional Ownership Tell Us About Peet?
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.
Peet already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Peet's historic earnings and revenue below, but keep in mind there's always more to the story.
Our data indicates that hedge funds own 6.0% of Peet. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Looking at our data, we can see that the largest shareholder is Anthony Lennon with 21% of shares outstanding. For context, the second largest shareholder holds about 19% of the shares outstanding, followed by an ownership of 12% by the third-largest shareholder. In addition, we found that Brendan Gore, the CEO has 1.5% of the shares allocated to their name.
After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.