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If you want to know who really controls Quad/Graphics, Inc. (NYSE:QUAD), then you'll have to look at the makeup of its share registry. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.
Quad/Graphics is not a large company by global standards. It has a market capitalization of US$195m, which means it wouldn't have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about Quad/Graphics.
What Does The Institutional Ownership Tell Us About Quad/Graphics?
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.
Quad/Graphics 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 Quad/Graphics' earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Quad/Graphics. Looking at our data, we can see that the largest shareholder is Quad/graphics, Inc. Voting Trust with 23% of shares outstanding. With 6.1% and 4.3% of the shares outstanding respectively, Quad/graphics Esop and The Vanguard Group, Inc. are the second and third largest shareholders. In addition, we found that J. Quadracci, the CEO has 3.7% of the shares allocated to their name.
After doing some more digging, we found that the top 11 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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Quad/Graphics
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.
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.
It seems insiders own a significant proportion of Quad/Graphics, Inc.. Insiders own US$21m worth of shares in the US$195m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 28% stake in Quad/Graphics. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
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. Be aware that Quad/Graphics is showing 3 warning signs in our investment analysis , and 1 of those shouldn't be ignored...
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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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