Crédit Agricole S.A.'s (EPA:ACA) biggest owners are private companies who got richer after stock soared 5.1% last week

Simply Wall St · 08/07/2023 06:01

Key Insights

  • The considerable ownership by private companies in Crédit Agricole indicates that they collectively have a greater say in management and business strategy
  • The largest shareholder of the company is SAS Rue La Boetie with a 57% stake
  • Institutional ownership in Crédit Agricole is 11%

To get a sense of who is truly in control of Crédit Agricole S.A. (EPA:ACA), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 57% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private companies were the biggest beneficiaries of last week’s 5.1% gain.

In the chart below, we zoom in on the different ownership groups of Crédit Agricole.

Check out our latest analysis for Crédit Agricole

ownership-breakdown
ENXTPA:ACA Ownership Breakdown August 7th 2023

What Does The Institutional Ownership Tell Us About Crédit Agricole?

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.

Crédit Agricole 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Crédit Agricole's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
ENXTPA:ACA Earnings and Revenue Growth August 7th 2023

Hedge funds don't have many shares in Crédit Agricole. The company's largest shareholder is SAS Rue La Boetie, with ownership of 57%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Credit Agricole SA, ESOP is the second largest shareholder owning 6.0% of common stock, and BlackRock, Inc. holds about 1.8% of the company stock.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Crédit Agricole

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 most recent data indicates that insiders own less than 1% of Crédit Agricole S.A.. But they may have an indirect interest through a corporate structure that we haven't picked up on. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own €1.2m of stock. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 26% stake in Crédit Agricole. 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 Company Ownership

Our data indicates that Private Companies hold 57%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

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. To that end, you should learn about the 2 warning signs we've spotted with Crédit Agricole (including 1 which can't be ignored) .

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.