Owning 54% in Viohalco S.A. (EBR:VIO) means that insiders are heavily invested in the company's future
Key Insights
- Significant insider control over Viohalco implies vested interests in company growth
- A total of 2 investors have a majority stake in the company with 58% ownership
- Institutional ownership in Viohalco is 35%
Every investor in Viohalco S.A. (EBR:VIO) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 54% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
So, insiders of Viohalco have a lot at stake and every decision they make on the company’s future is important to them from a financial point of view.
Let's take a closer look to see what the different types of shareholders can tell us about Viohalco.
Check out our latest analysis for Viohalco
What Does The Institutional Ownership Tell Us About Viohalco?
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.
As you can see, institutional investors have a fair amount of stake in Viohalco. 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 Viohalco's historic earnings and revenue below, but keep in mind there's always more to the story.
Viohalco is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Social and Cultural Affairs Welfare Foundation (Kikpe) with 30% of shares outstanding. In comparison, the second and third largest shareholders hold about 27% and 19% of the stock.
After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Viohalco
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. 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.
It seems that insiders own more than half the Viohalco S.A. stock. This gives them a lot of power. Insiders own €1.6b worth of shares in the €3.0b company. That's extraordinary! It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.
General Public Ownership
The general public-- including retail investors -- own 12% stake in the company, and hence can't 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 Viohalco better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Viohalco you should be aware of.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
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.