Institutions profited after EVgo, Inc.'s (NASDAQ:EVGO) market cap rose US$24m last week but retail investors profited the most

EVgo Inc Ordinary Shares - Class A -1.44% Post

EVgo Inc Ordinary Shares - Class A

EVGO

2.05

2.03

-1.44%

-0.93% Post

Key Insights

  • The considerable ownership by retail investors in EVgo indicates that they collectively have a greater say in management and business strategy
  • 47% of the business is held by the top 25 shareholders
  • Insiders have sold recently

If you want to know who really controls EVgo, Inc. (NASDAQ:EVGO), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 47% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While retail investors were the group that reaped the most benefits after last week’s 10% price gain, institutions also received a 47% cut.

Let's take a closer look to see what the different types of shareholders can tell us about EVgo.

Check out our latest analysis for EVgo

ownership-breakdown
NasdaqGS:EVGO Ownership Breakdown March 30th 2024

What Does The Institutional Ownership Tell Us About EVgo?

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.

EVgo 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 EVgo, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
NasdaqGS:EVGO Earnings and Revenue Growth March 30th 2024

Hedge funds don't have many shares in EVgo. The company's largest shareholder is The Vanguard Group, Inc., with ownership of 9.1%. With 7.1% and 5.6% of the shares outstanding respectively, BlackRock, Inc. and LS Power Equity Advisors, LLC are the second and third largest shareholders.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of EVgo

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 EVgo, Inc.. It has a market capitalization of just US$757m, and the board has only US$4.0m worth of shares in their own names. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 47% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With a stake of 5.6%, private equity firms could influence the EVgo board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that EVgo is showing 3 warning signs in our investment analysis , you should know about...

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.

Every question you ask will be answered
Scan the QR code to contact us
whatsapp
Also you can contact us via