Warehouses De Pauw’s (EBR:WDP) 3.1% loss last week hit both individual investors who own 45% as well as institutions

Warehouses De Pauw’s (EBR:WDP) 3.1% loss last week hit both individual investors who own 45% as well as institutions


To get a sense of who is truly in control of Warehouses De Pauw (EBR:WDP), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 45% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While the holdings of individual investors took a hit after last week’s 3.1% price drop, institutions with their 31% holdings also suffered.

Let’s take a closer look to see what the different types of shareholders can tell us about Warehouses De Pauw.

Check out our latest analysis for Warehouses De Pauw

ownership-breakdown
ENXTBR:WDP Ownership Breakdown February 24th 2022

What Does The Institutional Ownership Tell Us About Warehouses De Pauw?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Warehouses De Pauw. 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. 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 Warehouses De Pauw, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
ENXTBR:WDP Earnings and Revenue Growth February 24th 2022

We note that hedge funds don’t have a meaningful investment in Warehouses De Pauw. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Warehouses De Pauw’s case, its Co-Chief Executive Officer, Tony De Pauw, is the largest shareholder, holding 24% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.0% and 3.1%, of the shares outstanding, respectively.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Warehouses De Pauw

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

It seems insiders own a significant proportion of Warehouses De Pauw. It has a market capitalization of just €6.3b, and insiders have €1.5b worth of shares in their own names. That’s quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 45% stake in Warehouses De Pauw. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We’ve identified 3 warning signs with Warehouses De Pauw (at least 2 which are significant) , and understanding them should be part of your investment process.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

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.



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