German American Bancorp, Inc.'s (NASDAQ:GABC) market cap touched US$990m last week, benefiting both individual investors who own 48% as well as institutions
Key Insights
Significant control over German American Bancorp by individual investors implies that the general public has more power to influence management and governance-related decisions
The top 25 shareholders own 44% of the company
Every investor in German American Bancorp, Inc. (NASDAQ:GABC) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 48% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
While individual investors were the group that benefitted the most from last week’s US$56m market cap gain, institutions too had a 47% share in those profits.
Let's take a closer look to see what the different types of shareholders can tell us about German American Bancorp.
Check out our latest analysis for German American Bancorp
What Does The Institutional Ownership Tell Us About German American Bancorp?
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.
German American Bancorp already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 German American Bancorp's earnings history below. Of course, the future is what really matters.
German American Bancorp is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is BlackRock, Inc. with 7.8% of shares outstanding. The Vanguard Group, Inc. is the second largest shareholder owning 5.5% of common stock, and Champlain Investment Partners, LLC holds about 5.1% 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.
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.
Insider Ownership Of German American Bancorp
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.
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 can report that insiders do own shares in German American Bancorp, Inc.. As individuals, the insiders collectively own US$46m worth of the US$990m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public-- including retail investors -- own 48% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for German American Bancorp you should know about.
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.
