Painful week for individual investors invested in Zehnder Group AG (VTX:ZEHN) after 7.1% drop, institutions also suffered losses

Key Insights

• The considerable ownership by individual investors in Zehnder Group indicates that they collectively have a greater say in management and business strategy
• 49% of the business is held by the top 25 shareholders
• Institutions own 34% of Zehnder Group

If you want to know who really controls Zehnder Group AG (VTX:ZEHN), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 44% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions who own 34% came under pressure after market cap dropped to CHF596m last week,individual investors took the most losses.

Let's delve deeper into each type of owner of Zehnder Group, beginning with the chart below.

Check out our latest analysis for Zehnder Group

What Does The Institutional Ownership Tell Us About Zehnder Group?

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.

We can see that Zehnder Group does have institutional investors; and they hold a good portion of the company's stock. 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 Zehnder Group's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Zehnder Group. Our data shows that Graneco AG is the largest shareholder with 18% of shares outstanding. UBS Asset Management AG is the second largest shareholder owning 5.9% of common stock, and The Vanguard Group, Inc. holds about 3.1% 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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Zehnder Group

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 report that insiders do own shares in Zehnder Group AG. It has a market capitalization of just CHF596m, and insiders have CHF23m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 44% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zehnder Group. 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.

Private Company Ownership

It seems that Private Companies own 18%, of the Zehnder Group stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Zehnder Group better, we need to consider many other factors. Take risks for example - Zehnder Group has 3 warning signs we think you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com