With 64% ownership, The Walt Disney Company ($DIS) boasts strong institutional backing.

Key Insights

• Significantly high institutional ownership implies Walt Disney's stock price is sensitive to their trading actions
• A total of 25 investors have a majority stake in the company with 37% ownership
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business.

Every investor in The Walt Disney Company ($DIS) should be aware of the most powerful shareholder groups. I can see that institutions own the lion's share in the company with 64% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Given the vast amount of money and research capacities at their disposal, institutional ownership tends to carry a lot 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.

What Does The Institutional Ownership Tell About Walt Disney?

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.

I can see that Walt Disney does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Walt Disney. 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. I note that hedge funds don't have a meaningful investment in Walt Disney. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc. with 8.0% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 6.6% of common stock, and State Street Global Advisors, Inc. holds about 3.9% of the company stock.

On studying our ownership data, I found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. 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 Walt Disney

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.

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.

Our data suggests that insiders own under 1% of The Walt Disney Company 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%, I can see that board members collectively own US$48m worth of shares (at current prices). Arguably recent buying and selling is just as important to consider.