Estia Health Limited (ASX:EHE) is definitely on the radar of institutional investors who own 50% of the company
To get a sense of who is truly in control of Estia Health Limited (ASX:EHE), it is important to understand the ownership structure of the business. With 50% stake, institutions possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Given the vast amount of money and research capacities at their disposal, institutional ownership tends to carry a lot of weight, especially with individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's take a closer look to see what the different types of shareholders can tell us about Estia Health.
See our latest analysis for Estia Health
What Does The Institutional Ownership Tell Us About Estia Health?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
Estia Health already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Estia Health's earnings history below. Of course, the future is what really matters.
Hedge funds don't have many shares in Estia Health. Our data shows that Seven Group Holdings Limited is the largest shareholder with 11% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.1% and 6.7% of the stock.
We also observed that the top 9 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.
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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Estia Health
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.