In This Article:
Key Insights
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Given the large stake in the stock by institutions, Solventum's stock price might be vulnerable to their trading decisions
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The top 9 shareholders own 51% of the company
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Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock
Every investor in Solventum Corporation (NYSE:SOLV) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 63% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.
Let's take a closer look to see what the different types of shareholders can tell us about Solventum.
View our latest analysis for Solventum
What Does The Institutional Ownership Tell Us About Solventum?
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.
Solventum already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Solventum, (below). Of course, keep in mind that there are other factors to consider, too.
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 Solventum. The company's largest shareholder is 3M Company, with ownership of 20%. For context, the second largest shareholder holds about 9.4% of the shares outstanding, followed by an ownership of 6.1% by the third-largest shareholder.
On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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.