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Every investor in NVIDIA Corporation (NASDAQ:NVDA) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 65% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Institutional investors would probably welcome last week's 3.7% increase in share prices after a year of 45% losses as a sign that returns are likely to begin trending higher.
In the chart below, we zoom in on the different ownership groups of NVIDIA.
Check out our latest analysis for NVIDIA
What Does The Institutional Ownership Tell Us About NVIDIA?
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 NVIDIA. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 NVIDIA's earnings history below. Of course, the future is what really matters.
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 NVIDIA. Our data shows that The Vanguard Group, Inc. is the largest shareholder with 8.3% of shares outstanding. With 7.2% and 5.5% of the shares outstanding respectively, BlackRock, Inc. and FMR LLC are the second and third largest shareholders. Additionally, the company's CEO Jen-Hsun Huang directly holds 3.5% of the total shares outstanding.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
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.
Insider Ownership Of NVIDIA
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.