Institutions’ substantial holdings in International Personal Finance implies that they have significant influence over the company’s share price
A total of 7 investors have a majority stake in the company with 54% ownership
Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business
Every investor in International Personal Finance plc (LON:IPF) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 73% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
Let’s take a closer look to see what the different types of shareholders can tell us about International Personal Finance.
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.
International Personal Finance already has institutions on the share registry. Indeed, they own a respectable stake in 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It’s therefore worth looking at International Personal Finance’s earnings history below. Of course, the future is what really matters.
LSE:IPF Earnings and Revenue Growth December 25th 2024
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Hedge funds don’t have many shares in International Personal Finance. Schroder Investment Management Limited is currently the largest shareholder, with 12% of shares outstanding. For context, the second largest shareholder holds about 11% of the shares outstanding, followed by an ownership of 8.3% by the third-largest shareholder. Additionally, the company’s CEO Gerard Ryan directly holds 0.7% of the total shares outstanding.
On further inspection, we found that more than half the company’s shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
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.
Our most recent data indicates that insiders own some shares in International Personal Finance plc. In their own names, insiders own UK£21m worth of stock in the UK£284m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.
The general public, who are usually individual investors, hold a 19% stake in International Personal Finance. 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.
It’s always worth thinking about the different groups who own shares in a company. But to understand International Personal Finance better, we need to consider many other factors. Like risks, for instance. Every company has them, and we’ve spotted 2 warning signs for International Personal Finance (of which 1 can’t be ignored!) you should know about.
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.
