9 hours ago
While individual investors own 28% of Galderma Group AG (VTX:GALD), private equity firms are its largest shareholders with 39% ownership
Galderma Group's significant private equity firms ownership suggests that the key decisions are influenced by shareholders from the larger public
The top 4 shareholders own 53% of the company
21% of Galderma Group is held by Institutions
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Every investor in Galderma Group AG (VTX:GALD) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private equity firms with 39% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
And individual investors on the other hand have a 28% ownership in the company.
Let's take a closer look to see what the different types of shareholders can tell us about Galderma Group.
Check out our latest analysis for Galderma Group
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Galderma Group 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 Galderma Group's earnings history below. Of course, the future is what really matters.
Our data indicates that hedge funds own 10% of Galderma Group. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. The company's largest shareholder is Eqt Fund Management S.à R.L., with ownership of 28%. In comparison, the second and third largest shareholders hold about 11% and 10% of the stock. Additionally, the company's CEO Flemming Ornskov directly holds 0.7% of the total shares outstanding.
To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.
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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
We can see that insiders own shares in Galderma Group AG. The insiders have a meaningful stake worth CHF325m. Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.
The general public, who are usually individual investors, hold a 28% stake in Galderma Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
With a stake of 39%, private equity firms could influence the Galderma Group board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Galderma Group , and understanding them should be part of your investment process.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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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