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What Kind Of Shareholder Owns Most Armada Hoffler Properties, Inc. (NYSE:AHH) Stock?

Simply Wall St

If you want to know who really controls Armada Hoffler Properties, Inc. (NYSE:AHH), then you’ll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.’

Armada Hoffler Properties has a market capitalization of US$1.0b, so we would expect some institutional investors to have noticed the stock. Taking a look at our data on the ownership groups (below), it’s seems that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about AHH.

View our latest analysis for Armada Hoffler Properties

NYSE:AHH Ownership Summary, March 14th 2019

What Does The Institutional Ownership Tell Us About Armada Hoffler Properties?

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.

Armada Hoffler Properties already has institutions on the share registry. Indeed, they own 68% of the company. This suggests some credibility amongst professional investors. But we can’t rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there’s always a risk that they are in a ‘crowded trade’. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Armada Hoffler Properties’s historic earnings and revenue, below, but keep in mind there’s always more to the story.

NYSE:AHH Income Statement, March 14th 2019

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. It would appear that 5.0% of Armada Hoffler Properties shares are controlled by hedge funds. 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Armada Hoffler Properties

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. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.

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.

It seems insiders own a significant proportion of Armada Hoffler Properties, Inc.. It has a market capitalization of just US$1.0b, and insiders have US$142m worth of shares in their own names. That’s quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, with a 14% stake in the company, will not easily be ignored. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It’s always worth thinking about the different groups who own shares in a company. But to understand Armada Hoffler Properties better, we need to consider many other factors.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.