Private companies among boohoo group plc's (LON:DEBS) largest stockholders and were hit after last week's 10% price drop
Key Insights
- Significant control over boohoo group by private companies implies that the general public has more power to influence management and governance-related decisions
- 51% of the business is held by the top 3 shareholders
- 21% of boohoo group is held by insiders
Every investor in boohoo group plc (LON:DEBS) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 29% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
As a result, private companies as a group endured the highest losses last week after market cap fell by UK£23m.
Let's delve deeper into each type of owner of boohoo group, beginning with the chart below.
Check out our latest analysis for boohoo group
What Does The Institutional Ownership Tell Us About boohoo 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'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 boohoo group. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at boohoo group's earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 5.1% of boohoo group. 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. Mash Holdings Topco Limited is currently the largest shareholder, with 29% of shares outstanding. For context, the second largest shareholder holds about 15% of the shares outstanding, followed by an ownership of 6.7% by the third-largest shareholder. Mahmud Kamani, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of boohoo group
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
Our most recent data indicates that insiders own a reasonable proportion of boohoo group plc. Insiders have a UK£41m stake in this UK£199m business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 27% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Private Company Ownership
Our data indicates that Private Companies hold 29%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Public Company Ownership
It appears to us that public companies own 6.7% of boohoo group. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 2 warning signs we've spotted with boohoo group (including 1 which can't be ignored) .
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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.
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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.