In This Article:
Key Insights
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Significantly high institutional ownership implies Synopsys' stock price is sensitive to their trading actions
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50% of the business is held by the top 19 shareholders
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Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
A look at the shareholders of Synopsys, Inc. (NASDAQ:SNPS) can tell us which group is most powerful. The group holding the most number of shares in the company, around 88% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
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 take a closer look to see what the different types of shareholders can tell us about Synopsys.
View our latest analysis for Synopsys
What Does The Institutional Ownership Tell Us About Synopsys?
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.
We can see that Synopsys does have institutional investors; and they hold a good portion of the company's stock. 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 Synopsys' earnings history below. Of course, the future is what really matters.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Synopsys is not owned by hedge funds. The Vanguard Group, Inc. is currently the largest shareholder, with 9.3% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 8.6% of common stock, and Capital Research and Management Company holds about 4.7% of the company stock.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 19 shareholders, meaning that no single shareholder has a majority interest in the ownership.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.