Institutional investors must be pleased after a 7.5% gain last week that adds to Chemring Group PLC's (LON:CHG) one-year returns

editorial-team@simplywallst.com (Simply Wall St)

Mon, Feb 24, 2025, 10:34 PM 4 min read

Every investor in Chemring Group PLC (LON:CHG) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 87% 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.

Last week’s 7.5% gain means that institutional investors were on the positive end of the spectrum even as the company has shown strong longer-term trends. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 8.3%.

Let's delve deeper into each type of owner of Chemring Group, beginning with the chart below.

Check out our latest analysis for Chemring Group

ownership-breakdown — LSE:CHG Ownership Breakdown February 25th 2025

What Does The Institutional Ownership Tell Us About Chemring Group?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Chemring Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Chemring Group, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth — LSE:CHG Earnings and Revenue Growth February 25th 2025

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Chemring Group is not owned by hedge funds. Our data shows that BlackRock, Inc. is the largest shareholder with 7.3% of shares outstanding. For context, the second largest shareholder holds about 5.3% of the shares outstanding, followed by an ownership of 5.0% by the third-largest shareholder.

A closer look at our ownership figures suggests that the top 13 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Chemring Group

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our data suggests that insiders own under 1% of Chemring Group PLC in their own names. Keep in mind that it's a big company, and the insiders own UK£3.8m worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 11% stake in Chemring Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Chemring Group better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.