Significantly high institutional ownership implies Hurco Companies' stock price is sensitive to their trading actions
The top 10 shareholders own 52% of the company
Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
Every investor in Hurco Companies, Inc. (NASDAQ:HURC) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 56% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).
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Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence on its future.
Let's delve deeper into each type of owner of Hurco Companies, beginning with the chart below.
NasdaqGS:HURC Ownership Breakdown October 21st 2024
What Does The Institutional Ownership Tell Us About Hurco Companies?
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.
Hurco Companies 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 Hurco Companies, (below). Of course, keep in mind that there are other factors to consider, too.
NasdaqGS:HURC Earnings and Revenue Growth October 21st 2024
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. It would appear that 12% of Hurco Companies shares are controlled by hedge funds. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. Our data shows that Polar Asset Management Partners Inc. is the largest shareholder with 12% of shares outstanding. With 6.6% and 5.5% of the shares outstanding respectively, Dimensional Fund Advisors LP and Oppenheimer + Close, LLC are the second and third largest shareholders. In addition, we found that Gregory Volovic, the CEO has 1.5% of the shares allocated to their name.
We also observed that the top 10 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Hurco Companies
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
Shareholders would probably be interested to learn that insiders own shares in Hurco Companies, Inc.. As individuals, the insiders collectively own US$10m worth of the US$134m company. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.
General Public Ownership
The general public, who are usually individual investors, hold a 24% stake in Hurco Companies. 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.
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.
