Key Insights

• Significantly high institutional ownership implies FTAI Infrastructure's stock price is sensitive to their trading actions
• 50% of the business is held by the top 11 shareholders
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of FTAI Infrastructure Inc. (NASDAQ:FIP), it is important to understand the ownership structure of the business. With 66% stake, institutions possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And things are looking up for institutional investors after the company gained US$86m in market cap last week. The one-year return on investment is currently 161% and last week's gain would have been more than welcomed.

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

What Does The Institutional Ownership Tell Us About FTAI Infrastructure?

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.

We can see that FTAI Infrastructure does have institutional investors; and they hold a good portion of the company's stock. 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 FTAI Infrastructure, (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. It would appear that 5.2% of FTAI Infrastructure shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. The company's largest shareholder is Washington State Investment Board, with ownership of 12%. BlackRock, Inc. is the second largest shareholder owning 7.3% of common stock, and The Vanguard Group, Inc. holds about 5.2% of the company stock.

After doing some more digging, we found that the top 11 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of FTAI Infrastructure

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 most recent data indicates that insiders own less than 1% of FTAI Infrastructure Inc.. It seems the board members have no more than US$7.3m worth of shares in the US$884m company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

With a 28% ownership, the general public, mostly comprising of individual investors, have some degree of sway over FTAI Infrastructure. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand FTAI Infrastructure better, we need to consider many other factors. Be aware that FTAI Infrastructure is showing 3 warning signs in our investment analysis , and 1 of those is a bit concerning...

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com