Teva Pharmaceutical Industries Limited's (NYSE:TEVA) high institutional ownership speaks for itself as stock continues to impress, up 9.1% over last week

Key Insights

• Given the large stake in the stock by institutions, Teva Pharmaceutical Industries' stock price might be vulnerable to their trading decisions
• 50% of the business is held by the top 24 shareholders
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

We check all companies for important risks. See what we found for Teva Pharmaceutical Industries in our free report.

Every investor in Teva Pharmaceutical Industries Limited (NYSE:TEVA) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 74% to be precise, is institutions. Put another way, the group faces the maximum upside potential (or downside risk).

And as as result, institutional investors reaped the most rewards after the company's stock price gained 9.1% last week. One-year return to shareholders is currently 17% and last week’s gain was the icing on the cake.

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

Check out our latest analysis for Teva Pharmaceutical Industries

What Does The Institutional Ownership Tell Us About Teva Pharmaceutical Industries?

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.

As you can see, institutional investors have a fair amount of stake in Teva Pharmaceutical Industries. 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. 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 Teva Pharmaceutical Industries' earnings history below. Of course, the future is what really matters.

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Hedge funds don't have many shares in Teva Pharmaceutical Industries. FMR LLC is currently the largest shareholder, with 7.0% of shares outstanding. With 4.6% and 3.7% of the shares outstanding respectively, BlackRock, Inc. and Phoenix Investments & Finances Ltd are the second and third largest shareholders.

A closer look at our ownership figures suggests that the top 24 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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 Teva Pharmaceutical Industries

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.

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 data suggests that insiders own under 1% of Teva Pharmaceutical Industries Limited in their own names. 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 US$82m worth of shares. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 26% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Teva Pharmaceutical Industries. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Teva Pharmaceutical Industries better, we need to consider many other factors.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

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.