Racing Force S.P.A.’s (BIT:RFG) largest shareholders are private equity firms who were rewarded as market cap surged €13m last week

Key Insights

• Racing Force’s significant private equity firms ownership suggests that the key decisions are influenced by shareholders from the larger public
• 53% of the company is held by a single shareholder (SAYE s.p.a.)
• Institutions own 13% of Racing Force

Every investor in Racing Force S.P.A. (BIT:RFG) 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 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private equity firms collectively scored the highest last week as the company hit €139m market cap following a 10% gain in the stock.

Let’s delve deeper into each type of owner of Racing Force, beginning with the chart below.

See our latest analysis for Racing Force

What Does The Institutional Ownership Tell Us About Racing Force?

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.

Racing Force 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Racing Force, (below). Of course, keep in mind that there are other factors to consider, too.

Racing Force is not owned by hedge funds. The company’s largest shareholder is SAYE s.p.a., with ownership of 53%. This implies that they have majority interest control of the future of the company. Meanwhile, the second and third largest shareholders, hold 1.9% and 1.5%, of the shares outstanding, respectively.

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 some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Racing Force

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.

Our most recent data indicates that insiders own less than 1% of Racing Force S.P.A.. However, it’s possible that insiders might have an indirect interest through a more complex structure. It has a market capitalization of just €139m, and the board has only €384k worth of shares in their own names. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public– including retail investors — own 32% stake in the company, and hence can’t easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Equity Ownership

With an ownership of 53%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For example, we’ve discovered 3 warning signs for Racing Force (1 is concerning!) that you should be aware of before investing here.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.