Siemens Healthineers AG's (ETR:SHL) stock price dropped 3.5% last week; public companies would not be happy

Key Insights

• Significant control over Siemens Healthineers by public companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is Siemens Aktiengesellschaft with a 74% stake
• Institutional ownership in Siemens Healthineers is 10%

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To get a sense of who is truly in control of Siemens Healthineers AG (ETR:SHL), it is important to understand the ownership structure of the business. We can see that public companies own the lion's share in the company with 74% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 3.5% decline in share price, public companies suffered the most losses.

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

Check out our latest analysis for Siemens Healthineers

What Does The Institutional Ownership Tell Us About Siemens Healthineers?

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.

As you can see, institutional investors have a fair amount of stake in Siemens Healthineers. 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 Siemens Healthineers' earnings history below. Of course, the future is what really matters.

Siemens Healthineers is not owned by hedge funds. The company's largest shareholder is Siemens Aktiengesellschaft, with ownership of 74%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. The Vanguard Group, Inc. is the second largest shareholder owning 1.1% of common stock, and BlackRock, Inc. holds about 1.1% of the company stock.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Siemens Healthineers

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

We note our data does not show any board members holding shares, personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.

General Public Ownership

The general public, who are usually individual investors, hold a 16% stake in Siemens Healthineers. 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.

Public Company Ownership

It appears to us that public companies own 74% of Siemens Healthineers. 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. Case in point: We've spotted 1 warning sign for Siemens Healthineers 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. 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.