Are institutions heavily invested in Whitbread plc (LON: WTB) stocks?

If you want to know who really controls Whitbread plc (LON: WTB), you need to look at the composition of the share register. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their holdings over time. Companies that were previously publicly owned tend to have less insider ownership.

With a market cap of £ 6.7 billion, Whitbread is pretty big. We would expect to see institutional investors on the register. Companies of this size are also usually well known to private investors. Our analysis of company ownership below shows that institutions can be identified in the share register. Let’s dive deeper into each type of owner to learn more about Whitbread.

Check out our latest analysis for Whitbread

Property breakdown

What does institutional ownership tell us about Whitbread?

Many institutions measure their performance against an index that approximates the local market. As a result, they tend to pay more attention to companies that are in major indices.

Whitbread already has institutions on its share register. In fact, they own a respectable stake in the company. This may suggest that the company has some credibility in the investment community. However, it is best to be careful not to rely on the supposed validation of institutional investors. Sometimes they get it wrong too. It is not uncommon for the stock price to drop sharply when two large institutional investors are trying to sell a stock at the same time. So it’s worth checking out Whitbread’s past earnings performance (below). Of course, keep in mind that there are other factors to consider as well.

Revenue-and-revenue growth

Revenue-and-revenue growth

With institutional investors owning more than half of the stocks in issue, the board of directors will likely need to be mindful of their preferences. Whitbread is not owned by hedge funds. Our data shows that BlackRock, Inc. is the largest shareholder with 7.1% of the shares outstanding. The Vanguard Group, Inc. and MFS Investment Management, Inc. are the second and third largest shareholders with 4.0% and 3.6% of the shares outstanding, respectively.

After further research, we found that the top 21 collectively own 50% of the company, suggesting that no single shareholder has significant control over the company.

While studying the institutional ownership of a company can add value to your research, researching analyst recommendations to get a deeper understanding of a stock’s expected performance is also good practice. There are plenty of analysts covering the stock so it might be worthwhile to see what they are forecasting as well.

Whitbread inside ownership

The definition of an insider can vary slightly between countries, but the members of the board of directors always count. The company management is subordinate to the board of directors and this should represent the interests of the shareholders. It is noteworthy that sometimes top managers sit on the board themselves.

I generally think insider ownership is a good thing. In some cases, however, it makes it difficult for other shareholders to hold the board responsible for decisions.

Our data suggests that insiders own less than 1% of Whitbread plc on their own behalf. Since we’re so big, we wouldn’t expect insiders to own a large stake in the stock. Together they own £ 8.3 million in shares. It is equally important to consider recent purchases and sales. You can click here to see if Insiders bought or sold.

General public property

With a 16% share, the public has some influence on Whitbread. While this property size may not be sufficient to sway a political decision in their favor, they can still have a collective influence on company policy.

Next Steps:

I find it very interesting to see who exactly owns a company. But to really gain insight, we need to consider other information as well.

I like to dive deeper how a company has developed in the past. You can access it interactive graphics of past profits, sales and cash flows for free.

If you’re like me, you might want to think about whether this company is going to grow or shrink. Fortunately, you can check out this free analyst forecast report for the future.

Note: The numbers in this article are calculated using data for the past twelve months, which refers to the twelve month period ending on the last day of the month in which the financial statements are dated. This may not match the figures in the annual financial statements.

This article from Simply Wall St is of a general nature. We only provide comments based on historical data and analyst projections using an unbiased methodology, and our articles are not intended as financial advice. It is not a recommendation to buy or sell stocks and does not take into account your goals or your financial situation. Our goal is to provide you with long-term, focused analysis based on fundamentals. Note that our analysis may not take into account the latest company announcements or quality material, which may be sensitive to the price. Simply Wall St has no position in the stocks mentioned.

Do you have any feedback on this article? Concerned about the content? Get in touch directly with us. Alternatively, send an email to the editorial team (at) simplywallst.com.

About Nina Snider

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