Could the ownership structure of Sofina Société Anonyme (EBR: SOF) tell us anything useful?
Any investor in Sofina Société Anonyme (EBR: SOF) must know the most powerful groups of shareholders. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. We also tend to see a decrease in the number of insiders in companies that were previously state-owned.
With a market capitalization of 14 billion euros, Sofina Société Anonyme is rather large. We would expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. In the graph below, we can see that institutional investors have bought into the company. Let’s take a closer look at what the different types of shareholders can tell us about Sofina Société Anonyme.
See our latest analysis for Sofina Société Anonyme
What does institutional ownership tell us about Sofina Société Anonyme?
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 businesses to have some institutions listed, especially if they are growing.
Sofina Société Anonyme already has establishments registered in the share register. Indeed, they hold a respectable stake in the company. This may indicate that the company has a certain degree of credibility in the investment community. However, it is better not to rely on the so-called validation that accompanies institutional investors. They too are sometimes wrong. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell shares quickly. This risk is higher in a company without a history of growth. You can see Sofina Société Anonyme’s historical revenue and income below, but keep in mind that there is always more to tell.
Sofina Société Anonyme does not belong to hedge funds. The main shareholder of the company is Société De Participations Industries, held at 25%. Meanwhile, the second and third largest shareholders hold 23% and 7.5% of the outstanding shares, respectively.
A more detailed study of the register of shareholders showed us that 3 of the major shareholders hold a considerable share of the ownership of the company, through their 55% stake.
While it makes sense to study a company’s institutional ownership data, it also makes sense to study analysts’ sentiments to know which way the wind is blowing. We do not see any analyst coverage of the stock at this time, so the company is unlikely to be widely held.
Insider property of Sofina Société Anonyme
The definition of an insider may differ slightly from country to country, but board members still count. The management of the company is accountable to the board of directors and the board must represent the interests of the shareholders. Notably, sometimes senior executives themselves sit on the board.
Most view insider ownership as a positive, as it can indicate that the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
We note that our data does not show any member of the board of directors owning shares, personally. Since we do not detect insider ownership, we may have missing data. It would therefore be interesting to assess here the remuneration and seniority of the CEO.
General public property
The general public, including retail investors, own 34% of the company’s capital and therefore cannot be easily ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not aligned with other large shareholders.
Owned by a private company
We can see that the private companies own 55% of the issued shares. It is difficult to draw conclusions from this fact alone, so it is worth considering who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.
It’s always worth thinking about the different groups that own shares in a company. But to better understand Sofina Société Anonyme, there are many other factors to consider. To do this, you need to know the 1 warning sign we spotted with Sofina Société Anonyme.
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NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.