With 84% ownership of the shares, Cadence Bank (NYSE:CADE) is heavily dominated by institutional owners
In This Article:
Key Insights
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Given the large stake in the stock by institutions, Cadence Bank's stock price might be vulnerable to their trading decisions
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51% of the business is held by the top 8 shareholders
Every investor in Cadence Bank (NYSE:CADE) should be aware of the most powerful shareholder groups. With 84% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
Let's delve deeper into each type of owner of Cadence Bank, beginning with the chart below.
View our latest analysis for Cadence Bank
What Does The Institutional Ownership Tell Us About Cadence Bank?
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Cadence Bank 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 Cadence Bank's historic earnings and revenue below, but keep in mind there's always more to the story.
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. We note that hedge funds don't have a meaningful investment in Cadence Bank. The Vanguard Group, Inc. is currently the company's largest shareholder with 11% of shares outstanding. With 9.7% and 9.0% of the shares outstanding respectively, BlackRock, Inc. and FMR LLC are the second and third largest shareholders.
On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.