Individual investors account for 58% of Fomento Económico Mexicano, S.A.B. de C.V.'s (BMV:FEMSAUBD) ownership, while institutions account for 34%

Simply Wall St · 09/15/2023 12:03

Key Insights

  • The considerable ownership by individual investors in Fomento Económico Mexicano. de indicates that they collectively have a greater say in management and business strategy
  • A total of 25 investors have a majority stake in the company with 31% ownership
  • 34% of Fomento Económico Mexicano. de is held by Institutions

A look at the shareholders of Fomento Económico Mexicano, S.A.B. de C.V. (BMV:FEMSAUBD) can tell us which group is most powerful. The group holding the most number of shares in the company, around 58% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And institutions on the other hand have a 34% ownership in the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time.

In the chart below, we zoom in on the different ownership groups of Fomento Económico Mexicano. de.

See our latest analysis for Fomento Económico Mexicano. de

ownership-breakdown
BMV:FEMSA UBD Ownership Breakdown September 15th 2023

What Does The Institutional Ownership Tell Us About Fomento Económico Mexicano. de?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Fomento Económico Mexicano. de does have institutional investors; and they hold a good portion of the company's stock. 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 Fomento Económico Mexicano. de's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
BMV:FEMSA UBD Earnings and Revenue Growth September 15th 2023

Hedge funds don't have many shares in Fomento Económico Mexicano. de. Looking at our data, we can see that the largest shareholder is Cascade Investment, L.L.C. with 7.8% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 4.4% of common stock, and First Eagle Investment Management, LLC holds about 3.1% of the company stock.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Fomento Económico Mexicano. de

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our data cannot confirm that board members are holding shares personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.

General Public Ownership

The general public -- including retail investors -- own 58% of Fomento Económico Mexicano. de. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Private Equity Ownership

With a stake of 7.8%, private equity firms could influence the Fomento Económico Mexicano. de board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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. Be aware that Fomento Económico Mexicano. de is showing 1 warning sign in our investment analysis , you should know about...

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.