Key Insights

• The considerable ownership by private equity firms in Advantage Solutions indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is Leonard Green & Partners, L.P. with a 56% stake
• Recent sales by insiders

If you want to know who really controls Advantage Solutions Inc. (NASDAQ:ADV), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private equity firms with 56% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 5.2% decrease in the stock price last week, private equity firms suffered the most losses, but institutions who own 31% stock also took a hit.

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

View our latest analysis for Advantage Solutions

What Does The Institutional Ownership Tell Us About Advantage Solutions?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Advantage Solutions. 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. 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 Advantage Solutions' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Advantage Solutions. Leonard Green & Partners, L.P. is currently the largest shareholder, with 56% of shares outstanding. This implies that they have majority interest control of the future of the company. With 4.9% and 4.8% of the shares outstanding respectively, T. Rowe Price Group, Inc. and CVC Capital Partners plc are the second and third largest shareholders. In addition, we found that David Peacock, the CEO has 0.6% of the shares allocated to their name.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Advantage Solutions

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.

We can see that insiders own shares in Advantage Solutions Inc.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around US$22m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 11% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Advantage Solutions. 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.

Private Equity Ownership

With a stake of 56%, private equity firms could influence the Advantage Solutions board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Advantage Solutions you should know about.

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.