After losing 75% in the past year, Diebold Nixdorf, Incorporated (NYSE:DBD) institutional owners must be relieved by the recent gain
A look at the shareholders of Diebold Nixdorf, Incorporated (NYSE:DBD) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are institutions with 72% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Institutional investors would appreciate the 17% increase in share prices last week, given their one-year returns have been disappointing at 75%.
Let's take a closer look to see what the different types of shareholders can tell us about Diebold Nixdorf.
Check out our latest analysis for Diebold Nixdorf
What Does The Institutional Ownership Tell Us About Diebold Nixdorf?
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.
Diebold Nixdorf 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. 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 Diebold Nixdorf, (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. It would appear that 11% of Diebold Nixdorf shares are controlled by hedge funds. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc. with 7.4% of shares outstanding. Morgan Stanley, Investment Banking and Brokerage Investments is the second largest shareholder owning 5.8% of common stock, and BlackRock, Inc. holds about 5.7% of the company stock.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Diebold Nixdorf
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. 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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
We can see that insiders own shares in Diebold Nixdorf, Incorporated. It has a market capitalization of just US$188m, and insiders have US$6.2m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.
General Public Ownership
With a 14% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Diebold Nixdorf. 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.
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. Be aware that Diebold Nixdorf is showing 2 warning signs in our investment analysis , and 1 of those is concerning...
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.
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