A look at the shareholders of Savaria Corporation (TSE:SIS) can tell us which group is the most powerful. Institutions often own shares in larger companies, and we expect to see insiders owning a noticeable percentage of smaller ones. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, “Don’t tell me what you think, tell me what you have in your wallet”.

Savaria is not a big company by global standards. It has a market cap of C$980 million, which means it wouldn’t get the attention of many institutional investors. Looking at our ownership group data (below), it appears that institutions own shares in the company. Let’s dig deeper into each owner type to learn more about Savaria.

Discover our latest analysis for Savaria

What does institutional ownership tell us about Savaria?

Institutional investors typically compare their own returns to the returns of a commonly tracked index. They therefore generally consider buying larger companies that are included in the relevant benchmark.

We see that Savaria has institutional investors; and they own a good part of the shares of the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Savaria’s historic earnings and revenue below, but keep in mind there’s always more to tell.

Hedge funds don’t have a lot of shares in Savaria. The company’s CEO, Marcel Bourassa, is the main shareholder with 21% of the outstanding shares. With 7.9% and 3.0% of the outstanding shares respectively, Mawer Investment Management Ltd. and Fiera Capital Corporation are the second and third largest shareholders.

The story continues

Looking at our ownership data, we found that 25 of the major shareholders collectively own less than 50% of the share register, implying that no single individual holds a majority stake.

While it makes sense to study data on a company’s institutional ownership, it also makes sense to study analyst sentiment to find out which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it might be useful to know their overall view on the future.

Savaria Insider Property

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management of the company answers to the board of directors and the latter must represent the interests of the shareholders. In particular, sometimes the senior executives themselves sit on the board of directors.

I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.

It appears that insiders own a significant share of Savaria Corporation. Insiders have a C$235 million stake in the C$980 million business. We would say this shows alignment with shareholders, but it should be noted that the company is still quite small; some insiders may have founded the company. You can click here to see if these insiders have been buying or selling.

General public property

The general public, including retail investors, owns 54% of Savaria. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next steps:

I find it very interesting to see who exactly owns a company. But to really get insight, we also need to consider other information. For example, we found 5 warning signs for Savaria (1 cannot be ignored!) which you should be aware of before investing here.

But finally it’s the future, not the past, which will determine the performance of the owners of this company. Therefore, we think it’s advisable to take a look at this free report showing whether analysts are predicting a brighter future.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.