With 66% ownership of the shares, Cass Information Systems, Inc. (NASDAQ:CASS) is heavily dominated by institutional owners

Institutions’ substantial holdings in Cass Information Systems implies that they have significant influence over the company’s share price
The top 12 shareholders own 52% of the company
Insiders have been buying lately

A look at the shareholders of Cass Information Systems, Inc. (NASDAQ:CASS) can tell us which group is most powerful. With 66% stake, institutions possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

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. Therefore, a good portion of institutional money invested in the company is usually a huge vote of confidence on its future.

In the chart below, we zoom in on the different ownership groups of Cass Information Systems.

Check out our latest analysis for Cass Information Systems

ownership-breakdown — NasdaqGS:CASS Ownership Breakdown December 23rd 2024

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.

As you can see, institutional investors have a fair amount of stake in Cass Information Systems. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Cass Information Systems’ earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth — NasdaqGS:CASS Earnings and Revenue Growth December 23rd 2024

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Cass Information Systems is not owned by hedge funds. BlackRock, Inc. is currently the company’s largest shareholder with 8.1% of shares outstanding. With 7.8% and 6.2% of the shares outstanding respectively, AJH Investments Llc and Buckingham Strategic Wealth, LLC are the second and third largest shareholders.

A closer look at our ownership figures suggests that the top 12 shareholders have a combined ownership of 52% implying that no single shareholder has a majority.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can see that insiders own shares in Cass Information Systems, Inc.. In their own names, insiders own US$17m worth of stock in the US$570m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

The general public– including retail investors — own 23% 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.

Our data indicates that Private Companies hold 7.8%, of the company’s shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

It’s always worth thinking about the different groups who own shares in a company. But to understand Cass Information Systems better, we need to consider many other factors. Be aware that Cass Information Systems is showing 1 warning sign in our investment analysis , you should know about…

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.

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