Weis Markets, Inc. (NYSE:WMK) insiders have had a fantastic week as stock increased 3.1%, and they haven't stopped buying
Key Insights
Insiders appear to have a vested interest in Weis Markets' growth, as seen by their sizeable ownership
The top 3 shareholders own 54% of the company
To get a sense of who is truly in control of Weis Markets, Inc. (NYSE:WMK), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 39% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Insiders who purchased recently should be particularly happy after the stock gained 3.1% in the past week.
In the chart below, we zoom in on the different ownership groups of Weis Markets.
See our latest analysis for Weis Markets
What Does The Institutional Ownership Tell Us About Weis Markets?
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.
As you can see, institutional investors have a fair amount of stake in Weis Markets. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Weis Markets, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Weis Markets. The company's CEO Jonathan Weis is the largest shareholder with 39% of shares outstanding. Dimensional Fund Advisors LP is the second largest shareholder owning 7.7% of common stock, and The Vanguard Group, Inc. holds about 6.8% of the company stock.
A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.
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 Weis Markets
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.
Our information suggests that insiders maintain a significant holding in Weis Markets, Inc.. It has a market capitalization of just US$1.8b, and insiders have US$693m worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public-- including retail investors -- own 24% stake in the company, and hence can't easily be ignored. 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.
I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
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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