Yahoo Finance Institutional investors may overlook Blackstone Mortgage Trust, Inc.'s (NYSE:BXMT) recent US$157m market cap drop as long-term gains remain positive
Key Insights
Institutions' substantial holdings in Blackstone Mortgage Trust implies that they have significant influence over the company's share price
The top 18 shareholders own 50% of the company
Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
If you want to know who really controls Blackstone Mortgage Trust, Inc. (NYSE:BXMT), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are institutions with 64% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Losing money on investments is something no shareholder enjoys, least of all institutional investors who saw their holdings value drop by 4.8% last week. However, the 10% one-year returns may have helped alleviate their overall losses. But they would probably be wary of future losses.
Let's delve deeper into each type of owner of Blackstone Mortgage Trust, beginning with the chart below.
Check out our latest analysis for Blackstone Mortgage Trust
What Does The Institutional Ownership Tell Us About Blackstone Mortgage Trust?
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.
Blackstone Mortgage Trust 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 Blackstone Mortgage Trust, (below). Of course, keep in mind that there are other factors to consider, too.
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Hedge funds don't have many shares in Blackstone Mortgage Trust. The company's largest shareholder is BlackRock, Inc., with ownership of 16%. For context, the second largest shareholder holds about 10% of the shares outstanding, followed by an ownership of 4.5% by the third-largest shareholder.
After doing some more digging, we found that the top 18 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.
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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Blackstone Mortgage Trust
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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our information suggests that Blackstone Mortgage Trust, Inc. insiders own under 1% of the company. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own US$25m worth of shares. 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 35% stake in Blackstone Mortgage Trust. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
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 - Blackstone Mortgage Trust has 5 warning signs (and 2 which are a bit unpleasant) we think you should know about.
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.
