Key Insights

• Significantly high institutional ownership implies Douglas Elliman's stock price is sensitive to their trading actions

• 50% of the business is held by the top 20 shareholders

• Insiders have bought recently

Every investor in Douglas Elliman Inc. (NYSE:DOUG) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 42% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

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. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.

Let's delve deeper into each type of owner of Douglas Elliman, beginning with the chart below.

View our latest analysis for Douglas Elliman

What Does The Institutional Ownership Tell Us About Douglas Elliman?

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 Douglas Elliman. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Douglas Elliman, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Douglas Elliman. Looking at our data, we can see that the largest shareholder is Phillip Frost with 8.2% of shares outstanding. With 7.4% and 4.7% of the shares outstanding respectively, Howard Lorber and Clearline Capital LP are the second and third largest shareholders. Howard Lorber, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 20 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.