Stock Analysis

Hensoldt AG's (ETR:5UH) market cap dropped €147m last week; individual investors who hold 60% were hit as were institutions

Source: Shutterstock

Key Insights

  • Significant control over Hensoldt by individual investors implies that the general public has more power to influence management and governance-related decisions
  • 39% of the business is held by the top 25 shareholders
  • Institutions own 30% of Hensoldt

If you want to know who really controls Hensoldt AG (ETR:5UH), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 60% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions, who own 30% shares weren’t spared from last week’s €147m market cap drop, individual investors as a group suffered the maximum losses

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

View our latest analysis for Hensoldt

XTRA:5UH Ownership Breakdown March 18th 2023

What Does The Institutional Ownership Tell Us About Hensoldt?

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.

Hensoldt 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 Hensoldt's earnings history below. Of course, the future is what really matters.

XTRA:5UH Earnings and Revenue Growth March 18th 2023

Hensoldt is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Leonardo S.p.a. with 10.0% of shares outstanding. Lazard Asset Management LLC is the second largest shareholder owning 5.0% of common stock, and Wellington Management Group LLP holds about 3.0% of the company stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 Hensoldt

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our data cannot confirm that board members are holding shares personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 60% stake in Hensoldt, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Public Company Ownership

We can see that public companies hold 10.0% of the Hensoldt shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

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.

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.

Valuation is complex, but we're helping make it simple.

Find out whether Hensoldt is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis