Based on the latest SEC filings, institutions owning shares of Endeavor Group Holdings, Inc. (NYSE:EDR) have increased their transactions by 137.61%. Institutions now own 74.70% of the company.
Organizations that control large sums of money, like pension funds, insurance companies or mutual funds, who buy stocks are known as institutional investors. Compared to individual investors, institutional investors trade in large blocks, 10,000 or more shares per transaction. These large trades can affect the price of a commodity significantly.
Investors look favorably upon stocks with a large amount of institutional ownership. These large entities often hire a team of analysts to perform research prior to the group purchasing a company’s stock. Because of the large research investment made, institutions aren’t quick to sell their position.
Institutions may also influence the price of a stock after acquiring a position by using TV shows, articles in high-profile newspapers or magazines and presentations at investor conferences to help drive the price higher, increasing the value of the share.
PROS AND CONS
Is institutional ownership a good thing or a bad thing? This is a matter of debate. In his best-selling book, “One Up on Wall Street”, Peter Lynch lists thirteen characteristics of “the perfect stock.” Regarding institutional ownership, he says: “Institutions don’t own it and the analysts don’t follow it”. He sees commodities that the big investment groups ignore as having the potential to be undervalued.
In comparison, William O’Neil, founder of Investor’s Business Daily, thinks that institutional investors provide the largest source of stock demand. Something needed to increase the price of a share. He says that if a stock has no institutional owners, there is a reason for it. They’ve checked it out and passed. He looks at institutional ownership as a desirable characteristic in stocks, as noted in his book, “How to Make Money in Stocks”.
Both agree that institutional ownership can be a dangerous thing because they move in and out of the market in tremendous blocks, so the stock’s value can plunge if they sell off.
Endeavor Group Holdings, Inc. (NYSE:EDR) stock stands -14.21% away from its 50-day simple moving average and also -14.25% away from the 200-day average.
Recently, the commodity stands -27.26% away from the 52-week high and 9.67% from the 52-week low. The RSI (Relative Strength Index), an indicator that shows price strength by comparing upward and downward close-to-close movements is 39.73 for Endeavor Group Holdings, Inc. (NYSE:EDR).