Key Insights

• Institutions' substantial holdings in Alico implies that they have significant influence over the company's share price

• 50% of the business is held by the top 14 shareholders

• 28% of Alico is held by insiders

A look at the shareholders of Alico, Inc. (NASDAQ:ALCO) can tell us which group is most powerful. We can see that institutions own the lion's share in the company with 41% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.

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

View our latest analysis for Alico

What Does The Institutional Ownership Tell Us About Alico?

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.

Alico already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Alico's earnings history below. Of course, the future is what really matters.

Alico is not owned by hedge funds. Brian Higgins is currently the company's largest shareholder with 6.7% of shares outstanding. For context, the second largest shareholder holds about 6.6% of the shares outstanding, followed by an ownership of 5.3% by the third-largest shareholder.

A closer look at our ownership figures suggests that the top 14 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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.