In This Article:
Key Insights
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Institutions' substantial holdings in Plus500 implies that they have significant influence over the company's share price
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The top 19 shareholders own 50% of the company
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Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock
Every investor in Plus500 Ltd. (LON:PLUS) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Given the vast amount of money and research capacities at their disposal, institutional ownership tends to carry a lot of weight, especially with individual investors. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence on its future.
Let's take a closer look to see what the different types of shareholders can tell us about Plus500.
See our latest analysis for Plus500
What Does The Institutional Ownership Tell Us About Plus500?
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 Plus500. 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 Plus500's historic earnings and revenue below, but keep in mind there's always more to the story.
Our data indicates that hedge funds own 5.7% of Plus500. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. The company's largest shareholder is BlackRock, Inc., with ownership of 7.2%. Meanwhile, the second and third largest shareholders, hold 7.0% and 5.7%, of the shares outstanding, respectively.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 19 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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.