Yahoo Finance Workhorse Group Inc.'s (NASDAQ:WKHS) 11% loss last week hit both individual investors who own 58% as well as institutions
Every investor in Workhorse Group Inc. (NASDAQ:WKHS) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 58% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
While the holdings of individual investors took a hit after last week’s 11% price drop, institutions with their 33% holdings also suffered.
In the chart below, we zoom in on the different ownership groups of Workhorse Group.
View our latest analysis for Workhorse Group
What Does The Institutional Ownership Tell Us About Workhorse Group?
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.
We can see that Workhorse Group does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Workhorse Group, (below). Of course, keep in mind that there are other factors to consider, too.
It would appear that 5.6% of Workhorse Group shares are controlled by hedge funds. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. BlackRock, Inc. is currently the largest shareholder, with 6.3% of shares outstanding. With 5.6% and 5.3% of the shares outstanding respectively, Cowen Investment Management LLC and The Vanguard Group, Inc. are the second and third largest shareholders. Furthermore, CEO Richard Dauch is the owner of 1.2% of the company's shares.
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 it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Workhorse Group
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.
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 most recent data indicates that insiders own some shares in Workhorse Group Inc.. In their own names, insiders own US$11m worth of stock in the US$354m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public, who are usually individual investors, hold a substantial 58% stake in Workhorse Group, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should learn about the 4 warning signs we've spotted with Workhorse Group (including 1 which is significant) .
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
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