Retail investors account for 43% of Chr. Hansen Holding A/S' (CPH:CHR) ownership, while institutions account for 35%

Key Insights

• The considerable ownership by retail investors in Chr. Hansen Holding indicates that they collectively have a greater say in management and business strategy
• A total of 25 investors have a majority stake in the company with 47% ownership
• Institutions own 35% of Chr. Hansen Holding

To get a sense of who is truly in control of Chr. Hansen Holding A/S (CPH:CHR), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 43% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Institutions, on the other hand, account for 35% of the company's stockholders. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones.

Let's delve deeper into each type of owner of Chr. Hansen Holding, beginning with the chart below.

See our latest analysis for Chr. Hansen Holding

What Does The Institutional Ownership Tell Us About Chr. Hansen Holding?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Chr. Hansen Holding. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Chr. Hansen Holding, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Chr. Hansen Holding. The company's largest shareholder is Novo Holdings A/S, with ownership of 22%. For context, the second largest shareholder holds about 3.1% of the shares outstanding, followed by an ownership of 3.0% by the third-largest shareholder.

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.

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 Chr. Hansen Holding

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.

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 data suggests that insiders own under 1% of Chr. Hansen Holding A/S in their own names. It is a very large company, so it would be surprising to see insiders own a large proportion of the company. Though their holding amounts to less than 1%, we can see that board members collectively own kr.24m worth of shares (at current prices). It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 43% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Chr. Hansen Holding. 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.

Private Equity Ownership

With an ownership of 22%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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 2 warning signs for Chr. Hansen Holding you should be aware of.

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.