To get an idea of who actually controls 3i Group plc (LON:III), it is important to understand the ownership structure of the business. And the group that holds the biggest slice of the pie are institutions with 86% ownership. In other words, the group faces the maximum upside potential (or downside risk).
Since institutions have access to huge amounts of capital, their movements in the market tend to come under scrutiny from retail or individual investors. Therefore, a good deal of institutional money invested in the company is usually a huge vote of confidence in its future.
Let’s dive deeper into each type of 3i Group owner, starting with the table below.
Check out our latest analysis for 3i Group
What does institutional ownership tell us about 3i Group?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.
We can see that 3i Group has many institutional investors; and they own a good part of the shares of the company. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it’s worth checking out 3i Group’s earnings history below. Of course, the future is what really matters.
Investors should note that institutions actually own more than half of the company, so they can collectively wield significant power. Hedge funds do not have many shares in 3i Group. BlackRock, Inc. is currently the company’s largest shareholder with 8.6% of the shares outstanding. Artemis Investment Management LLP is the second largest shareholder with 5.0% of the common stock and The Vanguard Group, Inc. owns approximately 3.9% of the company’s stock. Additionally, the company’s CEO, Simon Borrows, directly owns 1.6% of the total shares outstanding.
After digging a little deeper, we found that the top 21 held combined ownership of 51% of the company, suggesting that no single shareholder has significant control over the company.
Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. There are plenty of analysts covering the stock, so it might be interesting to see what they are predicting as well.
3i Group Insider Ownership
The definition of an insider may differ slightly from country to country, but board members still matter. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
Insider ownership is positive when it signals that executives think like the true owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
Shareholders would probably be interested to learn that insiders hold shares in 3i Group plc. Insiders hold £237 million worth of shares (at current prices). Good to see this level of investment. You can check here if these insiders have bought recently.
General public property
With a 12% stake, the general public, consisting mainly of individual investors, has some influence over 3i Group. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
While it is worth considering the different groups that own a business, there are other, even more important factors. Like risks, for example. Every business has them, and we’ve spotted 3 warning signs for 3i Group (2 of which should not be ignored!) that you should know.
If you’re like me, you might want to ask yourself if this business will grow or shrink. Luckily, you can check out this free report showing analyst predictions for its future.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.