Institutional investors are CEWE Stiftung & Co. KGaA's (ETR:CWC) biggest bettors and were rewarded after last week's €50m market cap gain

Key Insights

• Significantly high institutional ownership implies CEWE Stiftung KGaA's stock price is sensitive to their trading actions
• The top 9 shareholders own 51% of the company
• 29% of CEWE Stiftung KGaA is held by insiders

Every investor in CEWE Stiftung & Co. KGaA (ETR:CWC) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 38% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).

And as as result, institutional investors reaped the most rewards after the company's stock price gained 7.2% last week. The one-year return on investment is currently 12% and last week's gain would have been more than welcomed.

In the chart below, we zoom in on the different ownership groups of CEWE Stiftung KGaA.

View our latest analysis for CEWE Stiftung KGaA

What Does The Institutional Ownership Tell Us About CEWE Stiftung KGaA?

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 CEWE Stiftung KGaA. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see CEWE Stiftung KGaA's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in CEWE Stiftung KGaA. Looking at our data, we can see that the largest shareholder is Alexander Neumüller with 29% of shares outstanding. Union Asset Management Holding AG is the second largest shareholder owning 7.4% of common stock, and Allianz Asset Management GmbH holds about 3.2% of the company stock.

We did some more digging and found that 9 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of CEWE Stiftung KGaA

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 CEWE Stiftung & Co. KGaA. It has a market capitalization of just €746m, and insiders have €215m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 33% stake in CEWE Stiftung KGaA. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

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

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

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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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.