Knorr-Bremse AG's (ETR:KBX) largest shareholders are private companies with 59% ownership, institutions own 24%
Key Insights
Knorr-Bremse's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
59% of the company is held by a single shareholder (Stella VermÖGensverwaltungs- Gmbh)
Every investor in Knorr-Bremse AG (ETR:KBX) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 59% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).
And institutions on the other hand have a 24% ownership in the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones.
Let's delve deeper into each type of owner of Knorr-Bremse, beginning with the chart below.
View our latest analysis for Knorr-Bremse
What Does The Institutional Ownership Tell Us About Knorr-Bremse?
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.
Knorr-Bremse already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Knorr-Bremse, (below). Of course, keep in mind that there are other factors to consider, too.
Knorr-Bremse is not owned by hedge funds. The company's largest shareholder is Stella VermÖGensverwaltungs- Gmbh, with ownership of 59%. This implies that they have majority interest control of the future of the company. The second and third largest shareholders are Capital Research and Management Company and Massachusetts Financial Services Company, with an equal amount of shares to their name at 3.0%.
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 Knorr-Bremse
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.
We note our data does not show any board members 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 17% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Company Ownership
It seems that Private Companies own 59%, of the Knorr-Bremse stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Knorr-Bremse better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Knorr-Bremse you should know about.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
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