Is Compugroup Medical SE & Co. KGaA's (ETR:COP) Shareholder Ownership Skewed Towards Insiders?

By
Simply Wall St
Published
March 03, 2021
XTRA:COP
Source: Shutterstock

The big shareholder groups in Compugroup Medical SE & Co. KGaA (ETR:COP) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

Compugroup Medical SE KGaA has a market capitalization of €3.6b, 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. In the chart below, we can see that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about Compugroup Medical SE KGaA.

Check out our latest analysis for Compugroup Medical SE KGaA

ownership-breakdown
XTRA:COP Ownership Breakdown March 4th 2021

What Does The Institutional Ownership Tell Us About Compugroup Medical SE KGaA?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Compugroup Medical SE KGaA does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Compugroup Medical SE KGaA's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
XTRA:COP Earnings and Revenue Growth March 4th 2021

Hedge funds don't have many shares in Compugroup Medical SE KGaA. Frank Gotthardt is currently the largest shareholder, with 33% of shares outstanding. With 6.6% and 5.7% of the shares outstanding respectively, Daniel Gotthardt and Brigitte Gotthardt are the second and third largest shareholders.

On looking further, we found that 51% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 Compugroup Medical SE KGaA

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems insiders own a significant proportion of Compugroup Medical SE & Co. KGaA. It has a market capitalization of just €3.6b, and insiders have €1.8b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public holds a 12% stake in Compugroup Medical SE KGaA. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Compugroup Medical SE KGaA better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Compugroup Medical SE KGaA you should be aware of.

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.

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This article by Simply Wall St is general in nature. 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.
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