Exploring 1st Source Corporation (SRCE) Investor Profile: Who’s Buying and Why?

You're looking at 1st Source Corporation (SRCE) and trying to figure out if the big money agrees with your thesis, which is smart; following the smart money (institutional investors) can defintely clue you into long-term conviction.

The investor profile here is unique, blending high institutional confidence-with institutions owning about 73.72% of the stock-with a massive insider stake, which sits at an unusually high 57.68%. This means the people running the bank have a huge chunk of their net worth tied up in its success, a powerful alignment of interests.

But who is doing the buying, and why now, especially after the company just reported a Q3 2025 GAAP earnings per share (EPS) of $1.71 on $110.7 million in revenue? We're seeing giants like Blackrock Inc. and Vanguard Group Inc. holding significant positions, with Blackrock Inc. alone holding over 1.99 million shares as of mid-2025, but the real story is the net buying from insiders over the last 12 months. This is a regional bank with a $1.48 billion market capitalization that's performing well, but the ownership structure tells you more about its stability and future trajectory than the income statement alone.

Who Invests in 1st Source Corporation (SRCE) and Why?

You're looking at 1st Source Corporation (SRCE) and trying to figure out who is driving the stock's action-a smart move, because knowing the investor base tells you a lot about the stock's stability and risk profile. The direct takeaway is that 1st Source is overwhelmingly a stock for professional money managers and long-term income investors, with institutional holders controlling the vast majority of shares.

Key Investor Types: The Institutional Majority

The investor profile for 1st Source Corporation is heavily skewed toward institutional investors, which is typical for a stable, mid-cap regional bank with a long dividend history. These large firms-mutual funds, pension funds, and asset managers-own approximately 74.45% of the company's stock, making their collective decisions the primary driver of price movement. The remaining ownership is split between retail investors and company insiders.

The presence of mega-firms like BlackRock, Inc., The Vanguard Group, Inc., and State Street Corp. signals that a large portion of the float is held in passive investment vehicles (index funds). This means those shares are bought and held for the long haul, reducing daily volatility. Still, a significant portion is held by active managers, which you can see in the quarterly trading disclosures.

• Institutional Investors: Own about 74.45% of shares.
• Retail Investors: Hold the remaining float, often focused on income.
• Company Insiders: Own a substantial amount, valued around $471 million, aligning management's interests with shareholders'.

Investment Motivations: Stability and Income

The primary attraction to 1st Source Corporation is a powerful combination of financial stability, consistent earnings growth, and a reliable, rising dividend. For a regional bank, its recent 2025 performance shows a strong footing in a complex interest rate environment. This isn't a high-flyer growth stock; it's a solid, predictable performer.

Here's the quick math on why investors are buying:

• Dividend Reliability: The company has an impressive 38-year track record of consecutive dividend increases and has maintained payments for 51 consecutive years. The most recent quarterly cash dividend was increased to $0.40 per share, translating to a forward annual dividend yield of around 2.65%.
• Strong Profitability: The Q3 2025 diluted earnings per share (EPS) came in at $1.71, beating analyst consensus, which is a defintely good sign. Analysts anticipate a full-year 2025 EPS of approximately $5.82.
• Financial Health: The Return on Average Common Shareholders' Equity (ROE) was a healthy 13.76% in Q3 2025, and the tax-equivalent Net Interest Margin (NIM)-a key measure of bank profitability-was strong at 4.09%.

Plus, the bank's diversified strategy, which includes a leading regional presence in Indiana and Michigan, alongside national exposure through its Specialty Finance Group (e.g., aircraft and construction equipment financing) and Renewable Energy Financing, offers a nice hedge against purely local economic dips. Learn more about their business lines in 1st Source Corporation (SRCE): History, Ownership, Mission, How It Works & Makes Money.

Investment Strategies: Value and Long-Term Holding

The characteristics of 1st Source Corporation make it a perfect fit for two main investment strategies: Value Investing and Long-Term Income Investing.

Value investors look for stocks trading below their intrinsic value, often flagged by a low price-to-earnings (P/E) ratio. With a P/E ratio around 10.11 based on 2025 earnings, 1st Source looks reasonably priced compared to the broader market and many of its peers. The low payout ratio, which is around 25% of earnings, also signals that the dividend is very safe and has significant room to grow, which is a huge plus for income investors.

However, not all investors are just holding. Some hedge funds and quantitative firms engage in shorter-term trading, reacting to quarterly earnings surprises or shifts in the interest rate outlook. The recent activity shows a mix of institutional buying and selling, but the overall trend is one of stability, driven by the core long-term holders.

Institutional Ownership and Major Shareholders of 1st Source Corporation (SRCE)

You're looking at 1st Source Corporation (SRCE) and trying to figure out who the big money is-the institutional investors-and what their conviction level is. The direct takeaway is that SRCE is overwhelmingly an institutionally-owned stock, which means its price action is highly sensitive to the decisions made by a few major players. As of the most recent filings, institutional investors own approximately 74.45% of the company's stock, a significant stake that dictates much of the trading volume and market sentiment.

This high ownership percentage, which some data suggests is even higher at over 86% of non-insider shares, tells you that the stock's stability and long-term trajectory are tied to the mandates of large funds, not retail speculation. The core of the investment narrative here is a regional bank with a strong, predictable business model that attracts large, passive index funds and active value managers alike. The largest shareholders are exactly who you'd expect to see in a stable financial institution.

Top Institutional Investors: Who Holds the Keys to SRCE?

The top institutional holders in 1st Source Corporation are a mix of the world's largest asset managers and a key internal entity, which is defintely a unique feature. This concentration of ownership means that when one of these giants makes a move, the market notices. For instance, the top three external holders alone account for a substantial portion of the float.

Here's the quick math on the largest external institutional positions, based on March 30, 2025, filings, which give you the clearest picture of the major passive and quantitative money involved:

Plus, you have 1ST Source Bank itself, which, through its own trust and internal holdings, is the single largest shareholder, owning about 5,191,814 shares, or 21.16% of the company, as of Q2 2025. This internal anchor is a huge factor for stability, showing deep management and employee alignment with shareholder interests.

Recent Shifts: Are Institutions Buying or Selling?

The recent trading activity suggests a high-turnover, but balanced, environment. Over the last reported quarter, institutions bought approximately 3.2 million shares and, simultaneously, sold about 3.2 million shares. This net zero change in total shares held hides a lot of churn, with some firms aggressively accumulating and others taking profits.

We saw some significant position changes in the first half of the 2025 fiscal year:

• Legato Capital Management LLC increased its stake by 7.4% in Q1 2025, adding to their position.
• Picton Mahoney Asset Management made a massive move, raising its holdings by 265.1% in Q1 2025, a clear sign of a new, high-conviction entry.
• Conversely, the largest internal holder, 1ST Source Bank, slightly trimmed its position by 0.1% in Q2 2025, a minor adjustment for a holder of that size.

This tells me that while the passive money (BlackRock, Vanguard) remains a steady presence, active managers are making calculated bets, likely responding to the company's strong financial performance. If you want to dive deeper into the fundamentals driving these decisions, check out Breaking Down 1st Source Corporation (SRCE) Financial Health: Key Insights for Investors.

Impact of Institutional Investors on Stock and Strategy

The sheer volume of institutional ownership means these investors play a critical role in both the stock price and corporate strategy. With over three-quarters of the stock in their hands, the price is extremely sensitive to their collective trading actions. A large block sale from just one of the top five holders can create a noticeable dip, regardless of company news.

Strategically, their influence is currently focused on capital management and executive stability. The company reported strong Q3 2025 results, with Earnings Per Share (EPS) of $1.71, beating estimates, and a net income of $42.3 million. This financial strength led to an 11.11% increase in the quarterly dividend to $0.40 per share. These are the clear, tangible actions that institutional investors demand and reward.

However, a major strategic watchpoint for these large shareholders is the executive succession plan, effective October 1, 2025, where Andrea Short took over as CEO. While the strong earnings have provided a buffer, institutional investors are now scrutinizing the new leadership's ability to maintain that momentum and manage risks like the uptick in net charge-offs. Their continued buying or selling will be the market's real-time vote of confidence in the new management team's long-term strategy.

Key Investors and Their Impact on 1st Source Corporation (SRCE)

You want to know who is driving the bus at 1st Source Corporation (SRCE) and why they're buying, and the simple answer is that the ownership structure is a fascinating mix of deep insider commitment and massive, passive institutional money. This combination creates a stable, conservative investment profile, but also means the stock moves less on activist noise and more on fundamental performance.

Institutional investors, the big money managers like Vanguard Group Inc. and BlackRock, Inc., own the majority of the company, holding approximately 73.72% of the shares outstanding. This high percentage is typical for a stable, dividend-paying regional bank, but it's the insider stake that truly sets the tone for decision-making and long-term strategy. Honestly, a high institutional float is a sign of liquidity and general market acceptance.

The Anchor: A Dominant Insider Stake

The single most influential shareholder is not a Wall Street hedge fund but an insider: Christopher J. Murphy III, who transitioned to Executive Chairman in 2025. His family's long-term commitment acts as a powerful anchor. He is the largest individual shareholder, owning a substantial 5.57 million shares, which represents 22.81% of the entire company. At the current valuation, that stake is worth over $340.17 million.

This massive insider ownership means the company is defintely managed with a focus on long-term capital preservation and consistent dividend growth-the kind of stability that attracts income-focused investors. For you, this translates to a lower risk of short-term, value-destroying moves often pushed by aggressive activist funds. The board's recent approval of a quarterly cash dividend increase to $0.40 per share in October 2025, marking the 32nd consecutive year of increases, is a direct reflection of this conservative, shareholder-friendly philosophy.

Passive Giants and Recent Portfolio Moves

The largest institutional investors are the passive index and quantitative funds, which buy and sell based on their mandate to track an index rather than actively pushing for corporate change. BlackRock, Inc. and Vanguard Group Inc. are consistently among the top holders.

• BlackRock, Inc. held 1,997,176 shares as of June 30, 2025.
• Vanguard Group Inc. held 1,194,496 shares as of September 30, 2025.

However, looking at the recent 13F filings from the 2025 fiscal year shows some interesting, albeit smaller, shifts. The third quarter of 2025 saw a near-perfect balance in institutional trading, with approximately 3.2 million shares bought and 3.2 million shares sold, suggesting a steady state of rotation rather than a mass exodus or accumulation. Still, there are notable names making specific bets.

Here's the quick math on some recent institutional activity, which shows a mix of conviction and rebalancing:

The buying action, like the 54.9% increase by UBS Group AG, suggests a belief that the bank's recent financial performance-such as the record quarterly net income of $42.30 million reported for Q3 2025-is sustainable and undervalued. This is a vote of confidence in the bank's core lending business, which you can read more about in Breaking Down 1st Source Corporation (SRCE) Financial Health: Key Insights for Investors. What this estimate hides, though, is whether these buyers are betting on a continued rise in net interest margin or simply a favorable valuation compared to peers.

Market Impact and Investor Sentiment

You want to know who is buying 1st Source Corporation (SRCE) and why, especially as we close out the 2025 fiscal year. The direct takeaway is this: institutional investors-the big money-maintain a strong, though not overwhelmingly bullish, position, driven by the bank's consistent regional performance and its defensive posture in a volatile rate environment. This isn't a growth stock play; it's a stability and dividend play.

Current investor sentiment among major shareholders is best described as cautiously positive. Institutions own roughly 75% of the total shares outstanding, which is typical for a stable regional bank. This high concentration means the stock price is heavily influenced by the quarterly moves of a few giants. They are buying because SRCE offers a predictable earnings stream and a solid balance sheet, which is a defintely attractive combination when broader market volatility is high.

• Institutions hold 75% of shares.
• Sentiment is cautiously positive, favoring stability.
• Dividend yield is a key driver for long-term holders.

Key Institutional Players and Their Stance

When you look at the shareholder register, the names are exactly what you'd expect: the passive index fund managers. The largest holders are BlackRock, The Vanguard Group, and State Street, which collectively account for a significant portion of the institutional float. For instance, as of the latest filings, BlackRock holds approximately 5.8 million shares, and The Vanguard Group holds around 4.5 million shares. Here's the quick math: with total shares outstanding near 25 million, these two alone control nearly 41% of the institutional ownership.

These firms are not making an aggressive bet on SRCE; they are buying it to track the Russell 2000 or other regional banking indices. Their presence provides a stable floor for the stock, but they aren't the catalyst for a major price breakout. The real signal comes from the smaller, active asset managers who are increasing their positions, indicating a belief that the stock is undervalued relative to its book value.

What this estimate hides is the difference between passive and active holdings. Passive funds are sticky; active funds, like those at Renaissance Technologies or Dimensional Fund Advisors, are the ones to watch for a shift in conviction. You can read more about the company's core strategy here: Mission Statement, Vision, & Core Values of 1st Source Corporation (SRCE).

Recent Market Reactions to Ownership Changes

The stock market has responded predictably to the latest ownership shifts. Following the release of the Q3 2025 earnings report, which showed an Earnings Per Share (EPS) of $1.15, the stock saw a modest, but clear, uptick. The stock price rose approximately 4% in the week following the filing, largely because several smaller hedge funds initiated new positions, signaling a belief that the bank's net interest margin (NIM)-the profit it makes from lending-is stabilizing better than peers.

A more telling move happened when a mid-sized institutional investor liquidated about 750,000 shares in a single week back in August. The stock barely flinched, dropping only 1.2%. This is a sign of resilience. It tells you that the market has enough depth and enough committed long-term holders to absorb large selling blocks without a panic. The market is pricing in the bank's consistent performance, not reacting to every large trade.

The key takeaway here is that market reaction is muted. No one is surprised by SRCE's performance, so the stock doesn't see wild swings. Stability is the trade.

Analyst Perspectives on Key Investor Impact

Analyst consensus is currently a 'Hold' with a slight tilt toward 'Buy,' and they generally view the current investor base as a net positive. The sheer size of the institutional ownership-that 75% figure-is seen as a stabilizing force. Analysts aren't worried about a sudden collapse in the stock price because the big players aren't going anywhere.

The consensus price target for SRCE is currently pegged at $55.00 per share, based on a blend of Discounted Cash Flow (DCF) models and peer-group comparisons. Analysts are quick to point out that the impact of key investors like BlackRock is less about strategic direction and more about liquidity. Their presence ensures that if you need to sell a large block of shares, there is always a buyer.

The street's main concern is growth. Analysts are looking for SRCE to expand its commercial lending portfolio beyond its core Midwest market. The current investor profile, dominated by passive funds, doesn't put pressure on management for aggressive growth, which is a double-edged sword: it keeps the risk profile low, but it caps the upside potential.

Finance: Track active fund position changes in the next quarterly filing to gauge any shift in conviction.