JM AB (publ)’s (STO:JM) latest 4.4% decline adds to one-year losses, institutional investors may consider drastic measures

Important Findings

• Given the large holdings of institutions in the stock, JM’s stock price could be vulnerable to their trading decisions
• A total of 4 investors hold a majority stake of 54% in the company
• A company’s past performance along with ownership data serves to provide a strong idea of ​​a company’s prospects

If you want to know who really controls JM AB (publ) (STO:JM) then you need to look at the composition of the share register. And the group holding the biggest piece of the pie are institutions with 45% ownership. That is, the group will benefit most when the stock goes up (or lose most when it goes down).

As a result, institutional investors suffered the heaviest losses last week after the market cap fell by 632 million kr. This group of investors may be particularly concerned about the current loss, which adds to a 24% year-on-year loss for shareholders. Institutions or “liquidity providers” control large sums of money and therefore these types of investors usually have a large influence on stock price movements. Therefore, if JM’s share price remains weak, institutional investors may feel compelled to sell the stock, which may not be ideal for individual investors.

Let’s take a closer look at what the different types of shareholders can tell us about JM.

Check out our latest analysis for JM

What does institutional ownership tell us about JM?

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 included in major indices.

As you can see, institutional investors have a significant stake in JM. This means that the analysts who work for these institutes have looked at the stock and like it. But just like everyone else, they can be wrong. If several institutes change their opinion on a stock at the same time, the share price could fall quickly. It is therefore worth checking out JM’s winning history below. Of course, what really matters is the future.

JM is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Samhällsbyggnadsbolaget i Norden AB (publ) with 32% of the outstanding shares. In comparison, the second- and third-largest shareholders hold around 11% and 5.4% of the shares, respectively.

Upon closer inspection, we found that 54% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a significant say in company decisions.

While examining a company’s institutional ownership can add value to your research, it’s also a good practice to research analyst recommendations to gain a deeper understanding of a stock’s expected performance. There have been a few analyst reports on the stock, but it could become even better known over time.

Insider ownership by JM

The definition of an insider may differ slightly from country to country, but board members always count. Management ultimately reports to the board of directors. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.

In general, I think insider ownership is a good thing. In some cases, however, it becomes more difficult for other shareholders to hold the board accountable for decisions.

Our information indicates that JM AB (publ) insiders own less than 1% of the company. It’s a big company, so even a small proportional stake can create alignment between the board and shareholders. In this case, insiders own shares worth 23 million kr. It’s always good to see at least some insider owners, but it might be worth checking to see if those insiders have sold.

General Public Property

The general public — including retail investors — own 22% of the shares in the company, so it can’t be ignored. While this ownership size is substantial, it may not be enough to change company policy if the decision is not aligned with other major shareholders.

ownership of public companies

It seems to us that public companies own 32% of JM. It’s hard to say for sure, but this suggests they may have intertwined business interests. This could be a strategic investment, so it’s worth watching for ownership changes in this area.

Next Steps:

While it’s worth considering the different groups that own a business, there are other factors that are even more important. Take risks, for example – JM did it 4 warning signs (and 3 we’re uncomfortable with) that we think you should know about.

But ultimately it is the future, not the past that determines how well the owners of this business will do. Therefore, we think it’s wise to take a look at this free report that shows whether analysts are predicting a brighter future.

Note: The figures in this article are calculated using data for the last twelve months, relating to the 12-month period ending on the last date of the month to which the financial statements are dated. This may not tally with the annual report figures for the full year.

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