Pfizer Limited's (NSE:PFIZER) 10% loss last week hit both individual investors who own 64% as well as institutions

Key Insights

• Significant control over Pfizer 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 Pfizer Inc. with a 62% stake
• Institutions own 18% of Pfizer

If you want to know who really controls Pfizer Limited (NSE:PFIZER), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 64% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 10% decrease in the stock price last week, public companies suffered the most losses, but institutions who own 18% stock also took a hit.

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

View our latest analysis for Pfizer

What Does The Institutional Ownership Tell Us About Pfizer?

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 Pfizer. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Pfizer's historic earnings and revenue below, but keep in mind there's always more to the story.

Pfizer is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Pfizer Inc. with 62% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Life Insurance Corporation of India, Asset Management Arm is the second largest shareholder owning 5.8% of common stock, and Nippon Life India Asset Management Limited holds about 3.7% of the company stock.

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 Pfizer

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own less than 1% of Pfizer Limited. However, it's possible that insiders might have an indirect interest through a more complex structure. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own ₹14m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

With a 15% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Pfizer. 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.

Public Company Ownership

We can see that public companies hold 64% of the Pfizer shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Pfizer better, we need to consider many other factors. Be aware that Pfizer is showing 1 warning sign in our investment analysis , 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.