Following a 26% decline over last year, recent gains may please Heartland Financial USA, Inc. (NASDAQ:HTLF) institutional owners
Key Insights
Significantly high institutional ownership implies Heartland Financial USA's stock price is sensitive to their trading actions
The top 12 shareholders own 51% of the company
A look at the shareholders of Heartland Financial USA, Inc. (NASDAQ:HTLF) can tell us which group is most powerful. With 70% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
After a year of 26% losses, last week’s 6.1% gain would be welcomed by institutional investors as a likely sign that returns might start trending higher.
In the chart below, we zoom in on the different ownership groups of Heartland Financial USA.
View our latest analysis for Heartland Financial USA
What Does The Institutional Ownership Tell Us About Heartland Financial USA?
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.
We can see that Heartland Financial USA 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. 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 Heartland Financial USA's earnings history below. Of course, the future is what really matters.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Heartland Financial USA is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is BlackRock, Inc. with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.3% and 6.4% of the stock.
After doing some more digging, we found that the top 12 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Heartland Financial USA
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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 most recent data indicates that insiders own some shares in Heartland Financial USA, Inc.. This is a big company, so it is good to see this level of alignment. Insiders own US$122m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.
General Public Ownership
With a 21% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Heartland Financial USA. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 2 warning signs for Heartland Financial USA (1 shouldn't be ignored!) that you should be aware of before investing here.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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.
