With 83% ownership of the shares, Treatt plc (LON:TET) is heavily dominated by institutional owners
In This Article:
Key Insights
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Institutions' substantial holdings in Treatt implies that they have significant influence over the company's share price
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The top 15 shareholders own 50% of the company
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Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock
If you want to know who really controls Treatt plc (LON:TET), 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 institutions with 83% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Given the vast amount of money and research capacities at their disposal, institutional ownership tends to carry a lot of weight, especially with individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
Let's delve deeper into each type of owner of Treatt, beginning with the chart below.
See our latest analysis for Treatt
What Does The Institutional Ownership Tell Us About Treatt?
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 Treatt 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. 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 Treatt's historic earnings and revenue below, but keep in mind there's always more to the story.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. We note that hedge funds don't have a meaningful investment in Treatt. Looking at our data, we can see that the largest shareholder is abrdn plc with 7.2% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.2% and 4.1% of the stock.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 15 shareholders, meaning that no single shareholder has a majority interest in the ownership.