What does the ownership structure of Generac Holdings Inc. (NYSE: GNRC) look like?



If you want to know who actually controls Generac Holdings Inc. (NYSE: GNRC), then you will need to examine the makeup of its share register. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that were previously state-owned tend to have fewer insiders.

With a market cap of US $ 23 billion, Generac Holdings is pretty big. We would expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. Looking at our data on ownership groups (below), it looks like institutional investors have bought the company. We can zoom in on the different ownership groups, to find out more about Generac Holdings.

Check out our latest review for Generac Holdings

NYSE: Distribution of ownership of the GNRC December 20, 2021

What does institutional ownership tell us about Generac Holdings?

Many institutions measure their performance against an index that approximates the local market. Thus, they generally pay more attention to companies that are included in the major indices.

As you can see, institutional investors have a significant stake in Generac Holdings. This suggests some credibility among professional investors. But we cannot rely on this fact alone because institutions sometimes make bad investments, like everyone else. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell shares quickly. This risk is higher in a company without a history of growth. You can see Generac Holdings’ historic earnings and earnings below, but keep in mind that there is always more to tell.

profit and revenue growth
NYSE: GNRC Profit and Revenue Growth December 20, 2021

Investors should note that institutions actually own more than half of the business, so collectively they can exercise significant power. We note that the hedge funds do not have a significant investment in Generac Holdings. Our data shows The Vanguard Group, Inc. is the largest shareholder with 11% of the shares outstanding. Meanwhile, the second and third largest shareholders hold 8.0% and 4.1% of the outstanding shares, respectively. Additionally, CEO Aaron Jagdfeld owns 1.0% of the company’s shares.

After digging a little deeper, we found that the top 21 own a combined 51% stake in the business, suggesting that no shareholder has significant control over the business.

While it makes sense to study a company’s institutional ownership data, it also makes sense to study analysts’ sentiments to know which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it can be helpful to know their overall vision for the future.

Insider ownership of Generac Holdings

The definition of business insiders can be subjective and vary from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company is accountable to the board of directors and the board must represent the interests of the shareholders. Notably, sometimes senior executives themselves sit on the board.

Most view insider ownership as a positive, as it can indicate that 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 shares of Generac Holdings Inc. Insiders own $ 337 million in shares (at current prices). Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking out if these insiders have sold.

General public property

With an 11% stake, the general public, made up primarily of individual investors, has some influence over Generac Holdings. This size of ownership, while considerable, may not be enough to change company policy if the decision is not aligned with other large shareholders.

Next steps:

I find it very interesting to see who exactly owns a company. But to really understand better, we have to take other information into account as well. Concrete example: we have spotted 2 warning signs for Generac Holdings you must be aware.

If you’d rather find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.

NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.



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