The recent 3.9% gain must have brightened CEO Claus Sauter's week, VERBIO Vereinigte BioEnergie AG's (ETR:VBK) most bullish insider
Key Insights
VERBIO Vereinigte BioEnergie's significant insider ownership suggests inherent interests in company's expansion
A total of 4 investors have a majority stake in the company with 54% ownership
Institutional ownership in VERBIO Vereinigte BioEnergie is 12%
If you want to know who really controls VERBIO Vereinigte BioEnergie AG (ETR:VBK), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 64% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
As a result, insiders scored the highest last week as the company hit €2.3b market cap following a 3.9% gain in the stock.
Let's take a closer look to see what the different types of shareholders can tell us about VERBIO Vereinigte BioEnergie.
Check out our latest analysis for VERBIO Vereinigte BioEnergie
What Does The Institutional Ownership Tell Us About VERBIO Vereinigte BioEnergie?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
We can see that VERBIO Vereinigte BioEnergie 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. 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 VERBIO Vereinigte BioEnergie's historic earnings and revenue below, but keep in mind there's always more to the story.
We note that hedge funds don't have a meaningful investment in VERBIO Vereinigte BioEnergie. Looking at our data, we can see that the largest shareholder is the CEO Claus Sauter with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 15% and 10% of the stock. Interestingly, the second-largest shareholder, Bernd Sauter is also Member of Management Board, again, pointing towards strong insider ownership amongst the company's top shareholders.
To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of VERBIO Vereinigte BioEnergie
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
It seems that insiders own more than half the VERBIO Vereinigte BioEnergie AG stock. This gives them a lot of power. Given it has a market cap of €2.3b, that means insiders have a whopping €1.5b worth of shares in their own names. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.
General Public Ownership
The general public-- including retail investors -- own 14% 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
It seems that Private Companies own 10%, of the VERBIO Vereinigte BioEnergie 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:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that VERBIO Vereinigte BioEnergie is showing 3 warning signs in our investment analysis , and 1 of those makes us a bit uncomfortable...
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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.
