Institutional investors control 42% of Fresenius Medical Care AG (ETR:FME) and were rewarded last week after stock increased 6.1%
In This Article:
Key Insights
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Given the large stake in the stock by institutions, Fresenius Medical Care's stock price might be vulnerable to their trading decisions
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53% of the business is held by the top 5 shareholders
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Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
Every investor in Fresenius Medical Care AG (ETR:FME) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 42% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And things are looking up for institutional investors after the company gained €769m in market cap last week. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 22%.
Let's take a closer look to see what the different types of shareholders can tell us about Fresenius Medical Care.
View our latest analysis for Fresenius Medical Care
What Does The Institutional Ownership Tell Us About Fresenius Medical Care?
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 Fresenius Medical Care. 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 Fresenius Medical Care's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Fresenius Medical Care. Fresenius SE & Co. KGaA is currently the largest shareholder, with 32% of shares outstanding. Dodge & Cox is the second largest shareholder owning 7.5% of common stock, and Harris Associates L.P. holds about 5.0% of the company stock.
Our research also brought to light the fact that roughly 53% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.
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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.