In spite of recent selling, insiders at Mission Produce, Inc. (NASDAQ:AVO) are the largest shareholders; own 39% shares
Key Insights
Insiders appear to have a vested interest in Mission Produce's growth, as seen by their sizeable ownership
The top 7 shareholders own 50% of the company
To get a sense of who is truly in control of Mission Produce, Inc. (NASDAQ:AVO), it is important to understand the ownership structure of the business. With 39% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Despite recent sales, insiders own the most shares in the company. As a result, they stand to gain the most after the stock gained 13% in the past week.
Let's delve deeper into each type of owner of Mission Produce, beginning with the chart below.
Check out our latest analysis for Mission Produce
What Does The Institutional Ownership Tell Us About Mission Produce?
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.
We can see that Mission Produce does have institutional investors; and they hold a good portion of the company's stock. 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 Mission Produce, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Mission Produce. Bruce Taylor is currently the company's largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 13% and 6.5% of the stock. Additionally, the company's CEO Stephen Barnard directly holds 5.4% of the total shares outstanding.
We did some more digging and found that 7 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Mission Produce
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
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 insiders own a significant proportion of Mission Produce, Inc.. Insiders own US$332m worth of shares in the US$855m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 31% stake in Mission Produce. 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.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Mission Produce better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Mission Produce you should be aware of.
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.
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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.
