With 75% ownership of the shares, GE HealthCare Technologies Inc. (NASDAQ:GEHC) is heavily dominated by institutional owners

Key Insights

  • Significantly high institutional ownership implies GE HealthCare Technologies’ stock price is sensitive to their trading actions

  • A total of 9 investors have a majority stake in the company with 52% ownership

  • Recent sales by insiders

A look at the shareholders of GE HealthCare Technologies Inc. (NASDAQ:GEHC) can tell us which group is most powerful. The group holding the most number of shares in the company, around 75% 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.

Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. As a result, a sizeable amount of institutional money invested in a firm is generally viewed as a positive attribute.

Let’s delve deeper into each type of owner of GE HealthCare Technologies, beginning with the chart below.

See our latest analysis for GE HealthCare Technologies

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ownership-breakdown

What Does The Institutional Ownership Tell Us About GE HealthCare 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.

As you can see, institutional investors have a fair amount of stake in GE HealthCare Technologies. 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 GE HealthCare Technologies, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growthearnings-and-revenue-growth

earnings-and-revenue-growth

Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. GE HealthCare Technologies is not owned by hedge funds. Capital Research and Management Company is currently the largest shareholder, with 12% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 6.8% of the stock.

We did some more digging and found that 9 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of GE HealthCare 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.

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 information suggests that GE HealthCare Technologies Inc. insiders own under 1% of the company. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own US$27m of stock. It is good to see board members owning shares, 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 18% stake in GE HealthCare 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.

Public Company Ownership

We can see that public companies hold 6.7% of the GE HealthCare Technologies shares on issue. We can’t be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It’s always worth thinking about the different groups who own shares in a company. But to understand GE HealthCare Technologies better, we need to consider many other factors. Be aware that GE HealthCare Technologies 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

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