Pioneer Natural Resources Company's (NYSE:PXD) institutional shareholders had a great week as one-year returns increased after a 3.5% gain last week
Simply Wall St
4 min read
Key Insights
Given the large stake in the stock by institutions, Pioneer Natural Resources' stock price might be vulnerable to their trading decisions
The top 16 shareholders own 51% of the company
Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business
To get a sense of who is truly in control of Pioneer Natural Resources Company (NYSE:PXD), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 86% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And as as result, institutional investors reaped the most rewards after the company's stock price gained 3.5% last week. One-year return to shareholders is currently 4.4% and last week’s gain was the icing on the cake.
Let's delve deeper into each type of owner of Pioneer Natural Resources, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Pioneer Natural Resources?
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 Pioneer Natural Resources. 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 Pioneer Natural Resources' earnings history below. Of course, the future is what really matters.
NYSE:PXD Earnings and Revenue Growth July 30th 2023
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hedge funds don't have many shares in Pioneer Natural Resources. Our data shows that Capital Research and Management Company is the largest shareholder with 8.5% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.4% and 7.4% of the stock.
A closer look at our ownership figures suggests that the top 16 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Pioneer Natural Resources
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our data suggests that insiders own under 1% of Pioneer Natural Resources Company in their own names. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own US$339m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, who are usually individual investors, hold a 13% stake in Pioneer Natural Resources. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Pioneer Natural Resources better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Pioneer Natural Resources .
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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