Given the significant institutional ownership in the stock, United Natural Foods’ stock price could be vulnerable to their trading decisions.
The top 8 shareholders own 51% of the company
Analyst forecasts along with ownership data are used to provide a clear picture of a company’s prospects.
If you want to know who really controls United Natural Foods, Inc. (NYSE: UNFI), then you’ll need to look at the makeup of its share registry. With 85% of the capital, institutions own the maximum share in the company. In other words, this is the group that will gain the most (or lose the most) from their investment in the business.
Since institutional owners have a huge pool of resources and liquidity, their investment decisions tend to carry a lot of weight, especially with individual investors. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence in its future.
Let’s take a closer look at each type of United Natural Foods owner, starting with the table below.
Check out our latest analysis for United Natural Foods
What does institutional ownership tell us about United Natural Foods?
Institutions typically measure themselves against a benchmark when reporting to their own investors. So they often become more enthusiastic about a stock once it is included in a major index. We expect most companies to have some institutions on the register, especially if they are growing.
As you can see, institutional investors own a significant stake in United Natural Foods. This implies that analysts working for these institutions have looked at the stock and like it. But like everyone else, they could be wrong. If multiple institutions change their views on a stock at the same time, the stock price could fall quickly. So it’s worth taking a look at United Natural Foods’s earnings history below. Of course, it’s the future that really matters.
Institutional investors own more than 50% of the company, and together they can likely heavily influence board decisions. Hedge funds don’t own much stock in United Natural Foods. The company’s largest shareholder is BlackRock, Inc., with a 16% stake. As a reminder, the second largest shareholder owns approximately 13% of the outstanding shares, followed by a 6.1% stake by the third largest shareholder.
We dug deeper and found that 8 of the largest shareholders represent around 51% of the register, implying that alongside the larger shareholders there are a few smaller shareholders, thus somewhat balancing each other’s interests .
While studying institutional ownership for a company can add value to your research, it is also a good idea 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 interesting to see their forecasts as well.
United Natural Foods Insider Ownership
The definition of an insider may differ slightly between countries, but board members still count. Company management runs the business, but the CEO will answer to the board of directors, even if he or she is a member of it.
I generally consider internal ownership to be a good thing. However, in some cases it is more difficult for other shareholders to hold the board accountable for its decisions.
Our most recent data indicates that insiders own some shares of United Natural Foods, Inc.. As individuals, insiders collectively own US$19m worth of the US$885m company. Some would say this shows an alignment of interests between shareholders and the board. But it might be worth checking to see if these insiders have been selling.
General public property
With a 13% stake, the general public, consisting primarily of individual investors, has some influence over United Natural Foods. This size of ownership, although considerable, may not be enough to change company policy if the decision is not in line with that of other large shareholders.
I find it very interesting to know who exactly owns a company. But to really understand better, we need to consider other information as well. Think about the risks, for example. Every business has them, and we spotted them 1 warning sign for United Natural Foods you should know that.
Eventually the future is the most important. You can access it free report on analyst 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 in which the financial statements are dated. This may not be consistent with the annual report figures for the entire 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 constitute financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your objectives or your financial situation. Our goal is to provide you with targeted, long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.