Stock Analysis

Painful week for individual investors invested in Deutsche Bank Aktiengesellschaft (ETR:DBK) after 4.5% drop, institutions also suffered losses

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XTRA:DBK
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Every investor in Deutsche Bank Aktiengesellschaft (ETR:DBK) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 51% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While the holdings of individual investors took a hit after last week’s 4.5% price drop, institutions with their 37% holdings also suffered.

Let's take a closer look to see what the different types of shareholders can tell us about Deutsche Bank.

Check out the opportunities and risks within the DE Capital Markets industry.

ownership-breakdown
XTRA:DBK Ownership Breakdown December 2nd 2022

What Does The Institutional Ownership Tell Us About Deutsche Bank?

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

earnings-and-revenue-growth
XTRA:DBK Earnings and Revenue Growth December 2nd 2022

Deutsche Bank is not owned by hedge funds. BlackRock, Inc. is currently the largest shareholder, with 6.6% of shares outstanding. In comparison, the second and third largest shareholders hold about 3.6% and 3.3% of the stock.

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.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Deutsche Bank

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our information suggests that insiders maintain a significant holding in Deutsche Bank Aktiengesellschaft. It has a market capitalization of just €20b, and insiders have €2.3b 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, who are usually individual investors, hold a substantial 51% stake in Deutsche Bank, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Deutsche Bank that you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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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