Great week for Hudson Technologies, Inc. (NASDAQ:HDSN) institutional investors after losing 54% over the previous year

Key Insights

• Given the large stake in the stock by institutions, Hudson Technologies' stock price might be vulnerable to their trading decisions
• 51% of the business is held by the top 14 shareholders
• Insiders have been buying lately

Every investor in Hudson Technologies, Inc. (NASDAQ:HDSN) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 73% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Last week's US$27m market cap gain would probably be appreciated by institutional investors, especially after a year of 54% losses.

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

View our latest analysis for Hudson Technologies

What Does The Institutional Ownership Tell Us About Hudson Technologies?

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.

Hudson Technologies already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Hudson Technologies' historic earnings and revenue below, but keep in mind there's always more to the story.

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hudson Technologies is not owned by hedge funds. Ernest Lazarus is currently the company's largest shareholder with 8.8% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 7.4% of common stock, and The Vanguard Group, Inc. holds about 5.5% of the company stock. Additionally, the company's CEO Brian Coleman directly holds 2.0% of the total shares outstanding.

After doing some more digging, we found that the top 14 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.

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

Insider Ownership Of Hudson Technologies

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.

It seems insiders own a significant proportion of Hudson Technologies, Inc.. Insiders have a US$32m stake in this US$264m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 15% stake in Hudson Technologies. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Hudson Technologies is showing 2 warning signs in our investment analysis , and 1 of those is significant...

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.