How Much Of Canadian Imperial Bank of Commerce (TSE:CM) Do Institutions Own?

By
Simply Wall St
Published
December 06, 2020
TSX:CM
Source: Shutterstock

If you want to know who really controls Canadian Imperial Bank of Commerce (TSE:CM), then you'll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that used to be publicly owned tend to have lower insider ownership.

Canadian Imperial Bank of Commerce has a market capitalization of CA$50b, so it's too big to fly under the radar. We'd expect to see both institutions and retail investors owning a portion of the company. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about Canadian Imperial Bank of Commerce.

View our latest analysis for Canadian Imperial Bank of Commerce

ownership-breakdown
TSX:CM Ownership Breakdown December 7th 2020

What Does The Institutional Ownership Tell Us About Canadian Imperial Bank of Commerce?

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.

As you can see, institutional investors have a fair amount of stake in Canadian Imperial Bank of Commerce. 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. 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 Canadian Imperial Bank of Commerce's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
TSX:CM Earnings and Revenue Growth December 7th 2020

Canadian Imperial Bank of Commerce is not owned by hedge funds. The company's largest shareholder is BMO Global Asset Management, with ownership of 4.5%. The second and third largest shareholders are RBC Global Asset Management Inc. and The Vanguard Group, Inc., with an equal amount of shares to their name at 3.0%.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Canadian Imperial Bank of Commerce

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 Canadian Imperial Bank of Commerce insiders own under 1% of the company. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own CA$23m worth of shares. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public -- mostly retail investors -- own 53% of Canadian Imperial Bank of Commerce. With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.

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.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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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