Westamerica Bancorporation’s (NASDAQ:WABC) -US$56m market value fall may be overlooked by institutional investors after a year of 1.3% returns

If you want to know who really controls Westamerica Bancorporation (NASDAQ:WABC), 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 78% ownership. Put another way, the group faces the maximum upside potential (or downside risk). Institutional investors were the group most impacted after the company’s market cap fell to US$1.5b last week. However, the 1.3% one-year returns may have helped alleviate their overall losses. We would assume however, that they would be on the lookout for weakness in the future. In the chart below, we zoom in on the different ownership groups of Westamerica Bancorporation. View our latest analysis for Westamerica Bancorporation NasdaqGS:WABC Ownership Breakdown December 18th 2022 What Does The Institutional Ownership Tell Us About Westamerica Bancorporation? 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. We can see that Westamerica Bancorporation does have institutional investors; and they hold a good portion of the company’s stock. 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 Westamerica Bancorporation, (below). Of course, keep in mind that there are other factors to consider, too. NasdaqGS:WABC Earnings and Revenue Growth December 18th 2022 Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Westamerica Bancorporation is not owned by hedge funds. BlackRock, Inc. is currently the largest shareholder, with 15% of shares outstanding. In comparison, the second and third largest shareholders hold about 12% and 7.8% of the stock. Furthermore, CEO David Payne is the owner of 3.3% of the company’s shares. On further inspection, we found that more than half of the company’s shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones. 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 understanding 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 Westamerica Bancorporation 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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or CEO. 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 Westamerica Bancorporation. This is a big company, so it is good to see this level of alignment. Insiders own US$58m 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 19% stake in Westamerica Bancorporation. 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: It’s always worth thinking about the different groups who own shares in a company. But to understand Westamerica Bancorporation better, we need to consider many other factors. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check out 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.Valuation is complex, but we’re helping make it simple.Find out whether Westamerica Bancorporation is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health. View the Free Analysis 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.

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