To understand who is really in control of Flight Center Travel Group Limited (ASX:FLT), it is important to understand the ownership structure of the business. And the group that holds the largest share of the pie are institutions with 42% ownership. In other words, the group will gain more (or lose more) from their investment in the company.
As a result, institutional investors suffered the biggest losses last week as market capitalization fell by AU$226 million. Needless to say, the latest loss, which is further added to the shareholders’ one-year loss of 35%, may not go down well with this category of shareholders in particular. Institutions or “liquidity providers” control large sums of money and therefore, these types of investors usually have a lot of influence on stock price movements. As a result, if the downward trend continues, institutions may face pressure to sell Flight Center Travel Group, which could have negative implications for individual investors.
Let’s dive deeper into each type of Flight Center Travel Group owner, starting with the chart below.
However, if you want to see where opportunities and risks are within the FLT industryYou can view our analysis on the AU Hospitality industry.
What Does Institutional Ownership Tell Us About Flight Center Travel Group?
Many institutions measure their performance against an index that approximates the domestic market. So they usually pay more attention to companies that are included in major indexes.
Flight Center Travel Group already has institutions in the share register. Indeed, they own a respectable stake in the company. This may indicate that the company has a certain degree of credibility in the investment community. However, it is best to be careful about relying on the supposed validation that comes with institutional investors. Even they sometimes make mistakes. If many institutions change their view on a stock at the same time, you may see the stock price drop quickly. Therefore, it is worth looking at the earnings history of Flight Center Travel Group below. Of course, the future is what really matters.
Flight Center Travel Group is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is CEO Graham Turner with 9.0% of the shares outstanding. With 8.2% and 7.4% of the shares outstanding respectively, FMR LLC and Geoff Harris are the second and third largest shareholders.
Looking at the shareholder register, we can see that 52% of the ownership is controlled by the top 11 shareholders, meaning that no single shareholder has a majority ownership interest.
Institutional ownership research is a good way to evaluate and filter the expected performance of a stock. The same can be achieved by studying the sentiments of analysts. There are a fair number of analysts covering the stock, so it may be helpful to find out their total outlook for the future.
Domestic ownership of Flight Center Travel Group
The definition of an insider may vary slightly in different countries, but members of the board of directors always count. The response of the company’s managers to the board and the latter must represent the interests of the shareholders. Notably, sometimes top-level managers are on board themselves.
Most consider insider ownership to be positive because it can indicate that the board is well connected to other shareholders. However, in some cases too much power is concentrated within this group.
Our information suggests that insiders hold significant ownership in Flight Center Travel Group Limited. Insiders own AU$468 million worth of shares in the AU$2.8 billion company. This is quite significant. Most would be pleased to see the board investing alongside them. You may want to use this free chart that shows recent insider trading.
General Public Ownership
The general public, who are usually individual investors, hold 36% of the shares in Flight Center Travel Group. This size of ownership, although significant, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Private Company Ownership
We can see that Private Companies own 6.2% of the shares in issue. It’s hard to draw any conclusions from this fact alone, so it’s worth looking at who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
I find it very interesting to see who exactly owns a company. But to really gain knowledge, we need to consider other information as well.
I like to dive deeper on how a company has performed in the past. You can find historical earnings and profits in this detailed chart.
After all the future is the most important. You can access this free report on analysts’ forecasts for the company.
NB: The figures in this article are calculated using data for the last twelve months, which refers to the 12-month period ending on the last day of the month of the financial statement date. This may not be consistent with the full year annual report figures.
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This article from 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 into account your financial objectives or situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not include the latest price-sensitive company announcements or quality materials. Simply Wall St has no position in any of the stocks mentioned.
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