A look at the shareholders of Rheinmetall AG (ETR:RHM) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 59% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Following a 7.7% increase in the stock price last week, retail investors profited the most, but institutions who own 41% stock also stood to gain from the increase.
Let's take a closer look to see what the different types of shareholders can tell us about Rheinmetall.
What Does The Institutional Ownership Tell Us About Rheinmetall?
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.
We can see that Rheinmetall does have institutional investors; and they hold a good portion of the company's stock. 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 Rheinmetall's historic earnings and revenue below, but keep in mind there's always more to the story.
XTRA:RHM Earnings and Revenue Growth January 20th 2025
Hedge funds don't have many shares in Rheinmetall. BlackRock, Inc. is currently the company's largest shareholder with 5.2% of shares outstanding. With 4.0% and 3.8% of the shares outstanding respectively, The Vanguard Group, Inc. and UBS Asset Management AG are the second and third largest shareholders.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Rheinmetall
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.
General Public Ownership
The general public, who are usually individual investors, hold a substantial 59% stake in Rheinmetall, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this freereport on analyst forecasts.
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.
