If you want to know who is really Meliá Hotels International, SA (BME: MEL), then you need to look at the composition of the share register. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their holdings over time. We also tend to see a lower proportion of insiders in companies that were previously publicly owned.
With a market capitalization of 1.3 billion euros, Meliá Hotels International is a decent size and is therefore likely on the radar of institutional investors. A look at our owner group data (below) shows that institutions own shares in the company. Let’s take a closer look at what the various types of shareholders can tell us about Meliá Hotels International.
Check out our latest analysis for Meliá Hotels International
BME: MEL Property Breakdown September 9, 2021
What does institutional ownership tell us about Meliá Hotels International?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they are often more enthusiastic about a stock once it has been included in a large index. We would expect most companies to have some institutes on their register, especially as they grow.
Meliá Hotels International already has institutions in the share register. In fact, they own a respectable stake in the company. This implies that the analysts who work for these institutions have looked at the stock and like it. But like everyone else, they can be wrong too. If several institutes own a share, there is always the risk that they are in a “crowd trade”. When such a trade goes wrong, multiple parties can compete to sell stocks quickly. This risk is higher in a company with no history of growth. Below is the historical revenue and earnings of Meliá Hotels International, but keep in mind that there is always more to history.
Meliá Hotels International is not owned by hedge funds. Our data shows that Hoteles Mallorquines Consolidados SA is the largest shareholder with 24% of the shares outstanding. The second and third largest shareholders are Hoteles Mallorquines Agrupados Sa and Hoteles Mallorquines Asociados, Sl.
On closer inspection, we found that 51% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the company’s decisions.
While it makes sense to examine institutional ownership data for a company, it also makes sense to examine analyst sentiment to know which way the wind is blowing. Quite a few analysts cover the stock so you can easily look at the forecast growth.
Inside Meliá Hotels International property
The definition of corporate insider can be subjective and varies depending on the legal system. Our data reflects individual insiders and at least includes board members. Management ultimately replies to the board. However, it is not uncommon for managers to be board members, especially when they are founders or CEOs.
Most consider insider ownership to be a positive as it may indicate that the board is well aligned with other shareholders. However, sometimes too much power is concentrated within this group.
Our data suggests that insiders own less than 1% of Meliá Hotels International, SA on their own behalf. However, we point out that it is possible that insiders have an indirect interest through a private company or another corporate structure. Remember that this is a large company and that Insider owns 1.6 million euros worth of shares. The absolute value could be more important than the proportional part. Seeing at least some inside property is always good, but it might be worth checking out when these insiders have sold.
General public property
The public holds 30% of the shares in Meliá Hotels International. While this property size may not be enough to sway a political decision in their favor, they can still have a collective influence on company policy.
Ownership of private companies
Our data shows that private companies own 51% of the company’s shares. It is difficult to draw any conclusions from this fact alone, so it is worth investigating who owns these private companies. Sometimes insiders or other related parties hold shares in a public company through a separate private company.
Next Steps:
While it is worth considering a company’s different groups of owners, there are other factors that are even more important. For example, consider the ubiquitous specter of investment risk. We identified 1 warning sign with Meliá Hotels International , and understanding them should be part of your investment process.
If you’d rather find out what analysts are predicting in terms of future growth, don’t miss out for free Report on analyst forecast.
Note: The numbers in this article are calculated using data for the past twelve months, which refers to the twelve month period ending on the last day of the month in which the financial statements are dated. This may not match the figures in the financial statements.
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This article from Simply Wall St is of a general nature. We only provide comments based on historical data and analyst projections using an unbiased methodology, and our articles are not intended as financial advice. It is not a recommendation to buy or sell stocks and does not take into account your goals or your financial situation. Our goal is to provide you with long-term, focused analysis based on fundamentals. Note that our analysis may not take into account the latest company announcements or quality material, which may be sensitive to the price. Simply Wall St has no position in the stocks mentioned.
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