Institutional investors control 55% of Resona Holdings, Inc. (TSE:8308) and were rewarded last week after stock increased 15%

Key Insights

• Institutions' substantial holdings in Resona Holdings implies that they have significant influence over the company's share price
• A total of 25 investors have a majority stake in the company with 49% ownership
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

We've discovered 1 warning sign about Resona Holdings. View them for free.

A look at the shareholders of Resona Holdings, Inc. (TSE:8308) can tell us which group is most powerful. We can see that institutions own the lion's share in the company with 55% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Last week’s 15% gain means that institutional investors were on the positive end of the spectrum even as the company has shown strong longer-term trends. One-year return to shareholders is currently 25% and last week’s gain was the icing on the cake.

In the chart below, we zoom in on the different ownership groups of Resona Holdings.

View our latest analysis for Resona Holdings

What Does The Institutional Ownership Tell Us About Resona Holdings?

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 Resona Holdings does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Resona Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Resona Holdings is not owned by hedge funds. Our data shows that BlackRock, Inc. is the largest shareholder with 6.6% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.3% and 4.1% of the stock.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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

Insider Ownership Of Resona Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our most recent data indicates that insiders own less than 1% of Resona Holdings, Inc.. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own JP¥1.2b worth of shares. 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 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Resona Holdings. 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Resona Holdings is showing 1 warning sign in our investment analysis , you should know about...

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.