Ralph Dommermuth United Internet AG's (ETR:UTDI) CEO is the most bullish insider, and their stock value gained 8.1%last week

Key Insights

• Insiders appear to have a vested interest in United Internet's growth, as seen by their sizeable ownership
• The largest shareholder of the company is Ralph Dommermuth with a 53% stake
• 25% of United Internet is held by Institutions

Every investor in United Internet AG (ETR:UTDI) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 53% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 8.1% gain.

In the chart below, we zoom in on the different ownership groups of United Internet.

Check out our latest analysis for United Internet

What Does The Institutional Ownership Tell Us About United Internet?

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.

United Internet already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 United Internet's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in United Internet. With a 53% stake, CEO Ralph Dommermuth is the largest shareholder. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. The second and third largest shareholders are Allianz Asset Management GmbH and Wellington Management Group LLP, with an equal amount of shares to their name at 3.4%.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. 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 United Internet

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.

It seems that insiders own more than half the United Internet AG stock. This gives them a lot of power. That means insiders have a very meaningful €1.8b stake in this €3.4b business. Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 22% stake in United Internet. 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. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for United Internet you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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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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.