Key Insights

• Redwire's significant private equity firms ownership suggests that the key decisions are influenced by shareholders from the larger public
• The largest shareholder of the company is AE Industrial Partners, LP with a 53% stake
• Institutions own 20% of Redwire

To get a sense of who is truly in control of Redwire Corporation (NYSE:RDW), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 59% to be precise, is private equity firms. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While the holdings of private equity firms took a hit after last week’s 30% price drop, institutions with their 20% holdings also suffered.

Let's delve deeper into each type of owner of Redwire, beginning with the chart below.

View our latest analysis for Redwire

What Does The Institutional Ownership Tell Us About Redwire?

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.

Redwire already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Redwire, (below). Of course, keep in mind that there are other factors to consider, too.

Redwire is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is AE Industrial Partners, LP with 53% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Genesis Park Management LLC is the second largest shareholder owning 5.4% of common stock, and BlackRock, Inc. holds about 2.4% of the company stock.

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

Insider Ownership Of Redwire

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

We can report that insiders do own shares in Redwire Corporation. In their own names, insiders own US$27m worth of stock in the US$972m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 18% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Redwire. 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 an ownership of 59%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. 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. To that end, you should be aware of the 1 warning sign we've spotted with Redwire .

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.