Every investor in Somero Enterprises, Inc. (LON:SOM) should know the most powerful shareholder groups. Institutions often own shares in larger companies, and we expect to see insiders owning a noticeable percentage of smaller ones. Companies that were previously publicly owned tend to have less insider ownership.
With a market capitalization of £275 million, Somero Enterprises is a small cap stock, so it may not be well known to many institutional investors. Looking at our ownership group data (below), it appears that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Somero Enterprises.
Check out our latest analysis for Somero Enterprises
What does institutional ownership tell us about Somero Enterprises?
Institutional investors typically compare their own returns to the returns of a commonly tracked index. They therefore generally consider buying larger companies that are included in the relevant benchmark.
Somero Enterprises already has institutions on the stock register. Indeed, they hold a respectable stake in 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 Somero Enterprises’ 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 don’t have a lot of shares in Somero Enterprises. Looking at our data, we can see that the largest shareholder is Unicorn Asset Management Limited with 10.0% of the shares outstanding. For context, the second-largest shareholder owns approximately 7.9% of the outstanding shares, followed by 6.9% ownership by the third-largest shareholder. Additionally, CEO John Cooney owns 1.1% of the company’s stock.
Upon closer inspection, we found that more than half of the company’s shares are held by the top 10 shareholders, suggesting that the interests of larger shareholders are to some extent balanced by those of smaller ones.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand a stock’s expected performance. There is some analyst coverage of the stock, but it could still become better known over time.
Insider ownership of Somero Enterprises
The definition of an insider may differ slightly from country to country, but board members still matter. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.
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.
We can report that insiders own shares in Somero Enterprises, Inc. As individuals, insiders collectively own £4.3 million worth of the £275 million company. This shows at least some alignment. You can click here to see if these insiders have been buying or selling.
General public property
With a 34% stake, the general public, consisting mostly of individual investors, has some influence over Somero Enterprises. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
Next steps:
I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. Example: we have identified 1 warning sign for Somero Enterprises you should be aware.
If you prefer to find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.
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.
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