Private companies are Construcciones y Auxiliar de Ferrocarriles, S.A.'s (BME:CAF) biggest owners and were rewarded after market cap rose by €89m last week

Key Insights

• The considerable ownership by private companies in Construcciones y Auxiliar de Ferrocarriles indicates that they collectively have a greater say in management and business strategy
• A total of 5 investors have a majority stake in the company with 50% ownership
• Institutions own 31% of Construcciones y Auxiliar de Ferrocarriles

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If you want to know who really controls Construcciones y Auxiliar de Ferrocarriles, S.A. (BME:CAF), then you'll have to look at the makeup of its share registry. We can see that private companies own the lion's share in the company with 37% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit €1.9b market cap following a 5.0% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Construcciones y Auxiliar de Ferrocarriles.

See our latest analysis for Construcciones y Auxiliar de Ferrocarriles

What Does The Institutional Ownership Tell Us About Construcciones y Auxiliar de Ferrocarriles?

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.

Construcciones y Auxiliar de Ferrocarriles 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 Construcciones y Auxiliar de Ferrocarriles' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Construcciones y Auxiliar de Ferrocarriles. Cartera Social, S.A. is currently the largest shareholder, with 24% of shares outstanding. With 13% and 5.2% of the shares outstanding respectively, BBK Gestion SGIIC SA and Danimar 1990 S.L. are the second and third largest shareholders.

On looking further, we found that 50% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Construcciones y Auxiliar de Ferrocarriles

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our data cannot confirm that board members are holding shares personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

General Public Ownership

With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Construcciones y Auxiliar de Ferrocarriles. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 37%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 1 warning sign for Construcciones y Auxiliar de Ferrocarriles you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

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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.