While institutions own 30% of Fresenius SE & Co. KGaA (ETR:FRE), individual investors are its largest shareholders with 43% ownership

editorial-team@simplywallst.com (Simply Wall St)

Mon, Oct 7, 2024, 12:58 AM 4 min read

To get a sense of who is truly in control of Fresenius SE & Co. KGaA (ETR:FRE), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Institutions, on the other hand, account for 30% of the company's stockholders. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time.

Let's take a closer look to see what the different types of shareholders can tell us about Fresenius SE KGaA.

Check out our latest analysis for Fresenius SE KGaA

ownership-breakdown — XTRA:FRE Ownership Breakdown October 7th 2024

What Does The Institutional Ownership Tell Us About Fresenius SE KGaA?

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 Fresenius SE KGaA. 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. 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 Fresenius SE KGaA's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth — XTRA:FRE Earnings and Revenue Growth October 7th 2024

We note that hedge funds don't have a meaningful investment in Fresenius SE KGaA. Else Kroner-Fresenius Foundation, Endowment Arm is currently the largest shareholder, with 27% of shares outstanding. Harris Associates L.P. is the second largest shareholder owning 3.0% of common stock, and The Vanguard Group, Inc. holds about 3.0% of the company stock.

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.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Fresenius SE KGaA

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

We note our data does not show any board members holding shares, personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

General Public Ownership

With a 43% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Fresenius SE KGaA. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Fresenius SE KGaA , and understanding them should be part of your investment process.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.