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If you want to know who really controls Oracle Corporation (NYSE:ORCL), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 43% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And following last week's 6.2% decline in share price, insiders suffered the most losses.
Let's delve deeper into each type of owner of Oracle, beginning with the chart below.
See our latest analysis for Oracle
What Does The Institutional Ownership Tell Us About Oracle?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
Oracle already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Oracle, (below). Of course, keep in mind that there are other factors to consider, too.
Oracle is not owned by hedge funds. Our data suggests that Lawrence Ellison, who is also the company's Top Key Executive, holds the most number of shares at 43%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. For context, the second largest shareholder holds about 5.1% of the shares outstanding, followed by an ownership of 4.3% by the third-largest shareholder.
To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of 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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Oracle
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.