Home Hedge Funds Private equity firms who hold 35% of Highlight Event and Entertainment AG...

Private equity firms who hold 35% of Highlight Event and Entertainment AG (VTX:HLEE) gained 11%, insiders profited as well

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SWX:HLEE

To get a sense of who is truly in control of Highlight Event and Entertainment AG (VTX:HLEE), it is important to understand the ownership structure of the business. With 35% stake, private equity firms possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While private equity firms were the group that reaped the most benefits after last week’s 11% price gain, insiders also received a 26% cut.

Let’s take a closer look to see what the different types of shareholders can tell us about Highlight Event and Entertainment.

See our latest analysis for Highlight Event and Entertainment

ownership-breakdown
SWX:HLEE Ownership Breakdown June 8th 2022

What Does The Lack Of Institutional Ownership Tell Us About Highlight Event and Entertainment?

We don’t tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it’s not particularly common.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. Alternatively, there might be something about the company that has kept institutional investors away. Highlight Event and Entertainment might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growth
SWX:HLEE Earnings and Revenue Growth June 8th 2022

Hedge funds don’t have many shares in Highlight Event and Entertainment. Looking at our data, we can see that the largest shareholder is Swiss International Investment Portfolio Ag with 26% of shares outstanding. For context, the second largest shareholder holds about 19% of the shares outstanding, followed by an ownership of 8.8% by the third-largest shareholder. Bernhard Burgener, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn’t analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Highlight Event and Entertainment

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems insiders own a significant proportion of Highlight Event and Entertainment AG. Insiders own CHF64m worth of shares in the CHF244m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public– including retail investors — own 18% stake in the company, and hence can’t easily be ignored. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With an ownership of 35%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

We can see that Private Companies own 17%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example – Highlight Event and Entertainment has 3 warning signs (and 1 which is a bit concerning) we think you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

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.

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