Key Insights
- Institutions' substantial holdings in Fresh Del Monte Produce implies that they have significant influence over the company's share price
- A total of 6 investors have a majority stake in the company with 50% ownership
- Recent sales by insiders
A look at the shareholders of Fresh Del Monte Produce Inc. (NYSE:FDP) can tell us which group is most powerful. The group holding the most number of shares in the company, around 66% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
And last week, institutional investors ended up benefitting the most after the company hit US$1.5b in market cap. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 24%.
Let's delve deeper into each type of owner of Fresh Del Monte Produce, beginning with the chart below.
See our latest analysis for Fresh Del Monte Produce
What Does The Institutional Ownership Tell Us About Fresh Del Monte Produce?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
As you can see, institutional investors have a fair amount of stake in Fresh Del Monte Produce. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Fresh Del Monte Produce's earnings history below. Of course, the future is what really matters.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hedge funds don't have many shares in Fresh Del Monte Produce. BlackRock, Inc. is currently the largest shareholder, with 13% of shares outstanding. Mohammad Abu-Ghazaleh is the second largest shareholder owning 11% of common stock, and The Vanguard Group, Inc. holds about 10% of the company stock. Mohammad Abu-Ghazaleh, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.
We also observed that the top 6 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of Fresh Del Monte Produce
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
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.
It seems insiders own a significant proportion of Fresh Del Monte Produce Inc.. It has a market capitalization of just US$1.5b, and insiders have US$264m worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.
General Public Ownership
The general public-- including retail investors -- own 16% stake in the company, and hence can't easily be ignored. 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.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Fresh Del Monte Produce better, we need to consider many other factors. For example, we've discovered 3 warning signs for Fresh Del Monte Produce that you should be aware of before investing here.
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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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.