Yahoo Finance The Hanover Insurance Group, Inc. (NYSE:THG) down to US$4.8b market cap, but institutional owners may not be as affected after a year of 4.0% returns
Key Insights
Given the large stake in the stock by institutions, Hanover Insurance Group's stock price might be vulnerable to their trading decisions
A total of 13 investors have a majority stake in the company with 51% ownership
If you want to know who really controls The Hanover Insurance Group, Inc. (NYSE:THG), then you'll have to look at the makeup of its share registry. We can see that institutions own the lion's share in the company with 87% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Institutional investors was the group most impacted after the company's market cap fell to US$4.8b last week. However, the 4.0% one-year return to shareholders may have helped lessen their pain. They should, however, be mindful of further losses in the future.
Let's take a closer look to see what the different types of shareholders can tell us about Hanover Insurance Group.
View our latest analysis for Hanover Insurance Group
What Does The Institutional Ownership Tell Us About Hanover Insurance 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.
As you can see, institutional investors have a fair amount of stake in Hanover Insurance Group. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Hanover Insurance Group, (below). Of course, keep in mind that there are other factors to consider, too.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hedge funds don't have many shares in Hanover Insurance Group. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc. with 10% of shares outstanding. With 9.2% and 5.6% of the shares outstanding respectively, BlackRock, Inc. and T. Rowe Price Group, Inc. are the second and third largest shareholders.
A closer look at our ownership figures suggests that the top 13 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.
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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Hanover Insurance 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.
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.
We can see that insiders own shares in The Hanover Insurance Group, Inc.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around US$50m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 12% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Hanover Insurance Group you should know about.
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.
