In This Article:
Key Insights
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Institutions' substantial holdings in Corteva implies that they have significant influence over the company's share price
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50% of the business is held by the top 17 shareholders
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Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business
A look at the shareholders of Corteva, Inc. (NYSE:CTVA) can tell us which group is most powerful. We can see that institutions own the lion's share in the company with 85% 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 US$1.2b in market cap last week. The gains from last week would have further boosted the one-year return to shareholders which currently stand at 15%.
In the chart below, we zoom in on the different ownership groups of Corteva.
View our latest analysis for Corteva
What Does The Institutional Ownership Tell Us About Corteva?
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.
Corteva 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Corteva's historic earnings and revenue below, but keep in mind there's always more to the story.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don't have a meaningful investment in Corteva. The company's largest shareholder is The Vanguard Group, Inc., with ownership of 11%. BlackRock, Inc. is the second largest shareholder owning 7.8% of common stock, and State Street Global Advisors, Inc. holds about 4.8% of the company stock.
After doing some more digging, we found that the top 17 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.