With 72% ownership, Vertical Aerospace Ltd. (NYSE:EVTL) insiders have a lot at stake

Key Insights

• Insiders appear to have a vested interest in Vertical Aerospace's growth, as seen by their sizeable ownership

• The largest shareholder of the company is Stephen Fitzpatrick with a 70% stake

• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in Vertical Aerospace Ltd. (NYSE:EVTL) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 72% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

So, insiders of Vertical Aerospace have a lot at stake and every decision they make on the company’s future is important to them from a financial point of view.

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

View our latest analysis for Vertical Aerospace

What Does The Institutional Ownership Tell Us About Vertical Aerospace?

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.

Institutions have a very small stake in Vertical Aerospace. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Vertical Aerospace is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Stephen Fitzpatrick with 70% of shares outstanding. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. With 5.3% and 2.6% of the shares outstanding respectively, American Airlines Group Inc. and Invesco Capital Management LLC are the second and third largest shareholders.

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.

Insider Ownership Of Vertical Aerospace

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 the majority of Vertical Aerospace Ltd.. This means they can collectively make decisions for the company. So they have a US$252m stake in this US$349m business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Vertical Aerospace. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

Public companies currently own 5.3% of Vertical Aerospace stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Vertical Aerospace is showing 6 warning signs in our investment analysis , and 3 of those are significant...

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.

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

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.

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