Institutional investors have a lot riding on Piper Sandler Companies (NYSE:PIPR) with 81% ownership

Key Insights

• Given the large stake in the stock by institutions, Piper Sandler Companies' stock price might be vulnerable to their trading decisions
• 51% of the business is held by the top 13 shareholders
• Insiders have been selling lately

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If you want to know who really controls Piper Sandler Companies (NYSE:PIPR), then you'll have to look at the makeup of its share registry. With 81% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And things are looking up for institutional investors after the company gained US$230m in market cap last week. The one-year return on investment is currently 23% and last week's gain would have been more than welcomed.

Let's take a closer look to see what the different types of shareholders can tell us about Piper Sandler Companies.

Check out our latest analysis for Piper Sandler Companies

What Does The Institutional Ownership Tell Us About Piper Sandler Companies?

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.

Piper Sandler Companies 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. 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 Piper Sandler Companies' 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 Piper Sandler Companies. The company's largest shareholder is BlackRock, Inc., with ownership of 15%. Meanwhile, the second and third largest shareholders, hold 12% and 3.9%, of the shares outstanding, respectively. Furthermore, CEO Chad Abraham is the owner of 0.5% of the company's shares.

Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 13 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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

Insider Ownership Of Piper Sandler Companies

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Piper Sandler Companies. This is a big company, so it is good to see this level of alignment. Insiders own US$124m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 16% stake in Piper Sandler Companies. 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:

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. For instance, we've identified 2 warning signs for Piper Sandler Companies that you should be aware of.

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.

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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.