Advertisement
Canada markets closed
  • S&P/TSX

    21,554.86
    -26.44 (-0.12%)
     
  • S&P 500

    5,464.62
    -8.55 (-0.16%)
     
  • DOW

    39,150.33
    +15.53 (+0.04%)
     
  • CAD/USD

    0.7305
    -0.0001 (-0.01%)
     
  • CRUDE OIL

    80.59
    -0.14 (-0.17%)
     
  • Bitcoin CAD

    87,635.30
    -383.62 (-0.44%)
     
  • CMC Crypto 200

    1,321.63
    -38.70 (-2.84%)
     
  • GOLD FUTURES

    2,334.70
    +3.50 (+0.15%)
     
  • RUSSELL 2000

    2,022.03
    +4.64 (+0.23%)
     
  • 10-Yr Bond

    4.2570
    +0.0030 (+0.07%)
     
  • NASDAQ

    17,689.36
    -32.24 (-0.18%)
     
  • VOLATILITY

    13.20
    -0.08 (-0.60%)
     
  • FTSE

    8,237.72
    -34.74 (-0.42%)
     
  • NIKKEI 225

    38,596.47
    -36.53 (-0.09%)
     
  • CAD/EUR

    0.6832
    +0.0011 (+0.16%)
     

Waste Management, Inc. (NYSE:WM) is favoured by institutional owners who hold 83% of the company

Key Insights

  • Given the large stake in the stock by institutions, Waste Management's stock price might be vulnerable to their trading decisions

  • 51% of the business is held by the top 25 shareholders

  • Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls Waste Management, Inc. (NYSE:WM), 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 83% ownership. 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. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.

ADVERTISEMENT

Let's delve deeper into each type of owner of Waste Management, beginning with the chart below.

View our latest analysis for Waste Management

ownership-breakdown
ownership-breakdown

What Does The Institutional Ownership Tell Us About Waste Management?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Waste Management. 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 Waste Management's earnings history below. Of course, the future is what really matters.

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

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Waste Management is not owned by hedge funds. Our data shows that The Vanguard Group, Inc. is the largest shareholder with 9.2% of shares outstanding. Bill & Melinda Gates Foundation Asset Trust is the second largest shareholder owning 8.7% of common stock, and BlackRock, Inc. holds about 7.4% of the company stock.

After doing some more digging, we found that the top 25 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Waste Management

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.

Our data suggests that insiders own under 1% of Waste Management, Inc. in their own names. It is a very large company, so it would be surprising to see insiders own a large proportion of the company. Though their holding amounts to less than 1%, we can see that board members collectively own US$130m worth of shares (at current prices). In this sort of situation, it can be more interesting to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 17% stake in Waste Management. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Waste Management better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Waste Management 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.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here