Exploring Waterstone Financial, Inc. (WSBF) Investor Profile: Who’s Buying and Why?

You're looking at Waterstone Financial, Inc. (WSBF) because the stock has shown a fascinating tug-of-war, with strong institutional buying contrasting with insider selling, and you need to know which side is winning. Why are firms like BlackRock, Inc. and Vanguard Group Inc. holding over 62.71% of the float, committing millions, while a director recently sold 79,872 shares for around $1.21 million in October 2025? It's a core question of conviction. The numbers tell a story of a regional bank that just posted a Q3 2025 net income of $7.9 million, a 73.1% jump from the prior year, pushing earnings per diluted share to $0.45, but the stock still trades at a price-to-earnings (P/E) ratio of 11.42-well below the peer average. Are the big players betting on the sustained turnaround in net interest margin (NIM) and the solid $0.15 quarterly dividend, or is the insider sale a warning about the valuation premium over the discounted cash flow (DCF) fair value? Let's dig into the 11,477,181 institutional shares to see who's buying, why they're holding, and what that means for your next move.

Who Invests in Waterstone Financial, Inc. (WSBF) and Why?

You're looking at Waterstone Financial, Inc. (WSBF) and trying to figure out who else is buying, and more importantly, why they see value in this regional bank. The direct takeaway is that WSBF is a classic income and value play, attracting a high percentage of institutional money focused on its dividend and capital return strategy, even as its valuation sparks debate.

The investor base is a balanced mix, but institutional money holds the controlling interest, which is typical for a stock traded on the NASDAQ Global Select Market. As of the most recent data, institutional investors own 51.79% of the company, while retail investors hold a significant 28.53%. The remaining 19.68% is held by company insiders, which is a substantial stake and often signals management's confidence in the long-term outlook. Honestly, that insider percentage is defintely high for a public company.

• Institutional Investors: 51.79% (Focus on stability, income, and capital return.)
• Retail Investors: 28.53% (Likely drawn to the dividend yield and regional bank stability.)
• Insiders: 19.68% (A strong indicator of management alignment with shareholder interests.)

Key Investor Types and Their Holdings

The institutional roster for Waterstone Financial, Inc. reads like a list of major asset managers. These aren't short-term traders; they are often massive index funds and quantitative firms. For example, Blackrock, Inc. /de is the largest institutional shareholder, with a position representing 8.77% of the outstanding shares. Other major holders include Dimensional Fund Advisors Lp and Vanguard Group Inc. These are players who often look for long-term stability and consistent income, not just a quick pop in the stock price.

Here's the quick math on the top institutional interest, which shows where the serious money is anchored:

What Attracts Investors: Income and Turnaround Value

The primary draw for a large portion of the investor base is income. Waterstone Financial, Inc. pays a quarterly dividend of $0.15 per share, translating to an annual dividend of $0.60 and a yield hovering around 3.85% to 3.95% in the 2025 fiscal year. This yield is attractive in the current rate environment, and the dividend payout ratio is a healthy 45.11% of earnings, which suggests it is sustainable.

But it's not just the dividend. Value investors are looking at the company's recent operational turnaround. The stock trades at a Price-to-Earnings (P/E) ratio of about 12x, which is notably below the average of 17.2x for its peers. This 'low multiple' is a classic value signal, but what's exciting for investors is the recent performance: the company reported a headline earnings growth of 77.8% over the past year (as of October 2025), a sharp reversal from its previous five-year trend. Plus, management is actively reducing the share count-the total common shares outstanding were reduced to 19,281,000 in 2025 through buybacks, directly boosting the book value to $17.70 per share.

Investment Strategies: Long-Term Income and Value Hunting

The dominant strategy here is a blend of long-term holding for income and a value-oriented approach betting on the turnaround. You see this reflected in the analyst ratings, which often rate the stock a 'Hold' for income-focused investors looking for a stable, long-term position. The value thesis is simple: buy a stock trading at a discount to its peers, which also has a clear path to improved profitability through operational efficiency and capital return. The dual-business model-Community Banking and Mortgage Banking-provides some diversification, and the recent improvement in the Community Banking segment's net interest margin (NIM) to 2.47% in Q1 2025 is a concrete sign of that operational improvement.

Still, you need to be realistic. While the P/E suggests value, the stock's market price of around $15.32 is significantly above a Discounted Cash Flow (DCF) fair value estimate of $3.75, according to some models. This gap shows that investors are pricing in a lot of future growth and a successful execution of the turnaround, so it's not a slam-dunk value play. It's a value-with-a-catalyst strategy. If you want to dig deeper into the company's core financial health, you should check out Breaking Down Waterstone Financial, Inc. (WSBF) Financial Health: Key Insights for Investors.

Next Step: Review your own portfolio's income needs and compare WSBF's dividend yield and payout ratio against your current holdings to see if it fits your long-term income bucket.

Institutional Ownership and Major Shareholders of Waterstone Financial, Inc. (WSBF)

You want to know who is really pulling the financial strings at Waterstone Financial, Inc. (WSBF), and the answer, as with most public companies, is the institutional money. These large players-mutual funds, pension funds, and asset managers-own a significant chunk of the company, and their moves are a clear signal of their confidence in its dual-business model (Community Banking and Mortgage Banking).

As of late 2025, institutional investors hold roughly 51.45% of Waterstone Financial's total shares outstanding. This level of ownership, while slightly below the regional bank industry average of 54.07%, still means that the company's stock price and strategy are heavily influenced by the decisions of a relatively small number of massive firms. In total, 104 institutional holders control approximately 9,496,967 shares.

Top Institutional Investors: Who Holds the Keys?

The largest institutional holders in Waterstone Financial are the titans of the asset management world. These are the firms that manage trillions of dollars and whose investment decisions can move a stock like WSBF. Their presence signals that the company's valuation and capital return strategy align with the mandates of large-scale index and actively managed funds.

Here's a look at the top four institutional holders and their positions based on recent 2025 filings:

Blackrock, Inc. is the single largest institutional shareholder, holding over 1.7 million shares as of June 30, 2025. That's a powerful stake for a company with a market capitalization of around $280.4 million.

Changes in Ownership: A Net Decrease, But More Buyers

The recent ownership activity is a mixed bag, which is typical in a shifting interest rate environment that impacts regional banks. While the overall institutional ownership percentage remained relatively stable at around 51.83% through October 2025, the underlying activity showed a net reduction in shares held.

In the most recent reporting period, 30 institutions decreased their positions, selling a total of 898,592 shares. The largest holders, including Blackrock and Vanguard Group Inc., were net sellers, trimming their stakes by 3% to nearly 4%. But here's the interesting part: 54 institutions actually increased their positions, buying a total of 670,191 shares. This tells me that while the largest passive funds might be rebalancing, more active managers are finding a new entry point.

• Total increased positions: 670,191 shares by 54 holders.
• Total decreased positions: 898,592 shares by 30 holders.
• Bridgeway Capital Management LLC, for example, grew its position by 1.904%.

The net selling by the big index funds is a technical move, but the increased number of buyers suggests a broader, albeit smaller, base of investors is warming up to the stock.

Impact of Institutional Investors on Strategy

What role do these large investors play? Their primary influence is on capital allocation and governance. Waterstone Financial's management, keenly aware of its shareholder base, has prioritized clear returns to shareholders. This is evident in the company's consistent dividend and share repurchase program.

The company has been actively buying back shares, reducing the total common shares outstanding from over 24.7 million in 2021 to 19.2 million in 2025. This is a smart financial move, as it spreads the company's net income-which hit $7.9 million in Q3 2025-over fewer shares, boosting earnings per share and book value. Plus, the quarterly cash dividend of $0.15 per common share is a direct nod to income-focused institutional and retail investors.

Institutional scrutiny also keeps management on its toes. The recent news of a director selling nearly all his shares, coupled with the institutional trimming, put the spotlight on leadership confidence and operational risk in Q3 2025. You can see the full financial picture in Breaking Down Waterstone Financial, Inc. (WSBF) Financial Health: Key Insights for Investors. For you, this means the institutional investors act as a constant check, ensuring the company maintains its focus on profitability (Q3 2025 Return on Average Equity was 9.14%) and shareholder value.

Key Investors and Their Impact on Waterstone Financial, Inc. (WSBF)

You're looking at Waterstone Financial, Inc. (WSBF) and wondering who's actually holding the stock and why their positions matter. The quick takeaway is that institutional money, primarily passive funds, controls the majority of the float, meaning their influence is more about long-term governance and capital allocation-like the company's aggressive share buybacks-than short-term activism.

As of mid-2025, institutional investors own roughly 51.79% of Waterstone Financial, Inc. shares, which is a significant chunk, though slightly below the regional bank sector average. This ownership structure means the company's management is constantly balancing the interests of large, passive funds with the desires of its smaller, more active retail and insider base. Honestly, it's a tightrope walk.

The Institutional Giants: Blackrock, Vanguard, and Dimensional

The largest shareholders in Waterstone Financial, Inc. are exactly who you'd expect: the behemoths of the asset management world. These are mostly passive investors, meaning they own the stock because it's part of an index or a broad exchange-traded fund (ETF). They don't typically push for a merger, but their sheer size gives them a powerful voice on issues like executive compensation and environmental, social, and governance (ESG) policies.

The top institutional holders, based on 2025 fiscal year filings, are led by Blackrock Inc., which holds a commanding position. Blackrock Inc. is the largest institutional shareholder, with approximately 1,717,280 shares held, valued at about $26.10 million. Dimensional Fund Advisors LP and Vanguard Group Inc. follow closely, holding 1,434,547 shares and 943,736 shares, respectively, with corresponding values of $21.81 million and $14.34 million. Their presence is a vote for stability, but also a constant pressure point for efficient capital use.

Recent Investor Moves and Capital Allocation

The most telling sign of investor influence isn't an activist letter; it's the company's own actions to return capital. Waterstone Financial, Inc.'s management has been aggressively buying back shares, a clear move to boost shareholder value and signal confidence in their turnaround. In the second quarter of 2025 alone, the company repurchased approximately 508,000 shares at an average cost of $12.80 per share, totaling $6.5 million. This action added approximately $0.14 to the book value per share, helping it rise to $18.19 by June 30, 2025. This is a direct benefit to all shareholders, especially the large institutional holders.

However, recent 13F filings show some subtle shifts among the giants. For instance, Blackrock Inc. reduced its stake by -3.98% in the second quarter of 2025, selling 71,178 shares, and Vanguard Group Inc. also trimmed its position by 34,618 shares in the third quarter of 2025. These are minor adjustments, but they indicate a slight rebalancing or profit-taking by the index funds. On the buying side, Bridgeway Capital Management LLC grew its position by 1.9% in Q2 2025, and CSM Advisors LLC established a new position of 197,250 shares in the same quarter. This suggests a few active managers see value in the stock's current price and the company's improved profitability, which saw Q2 2025 net income hit $7.7 million, or $0.43 per diluted share.

• Blackrock Inc. reduced holdings by 3.98% in Q2 2025.
• Vanguard Group Inc. sold 34,618 shares in Q3 2025.
• Waterstone Financial, Inc. repurchased 508,000 shares in Q2 2025.

You can see the long-term thinking behind the company's strategy-improving the core Community Banking segment and managing the volatility of the Mortgage Banking segment-by reviewing the Mission Statement, Vision, & Core Values of Waterstone Financial, Inc. (WSBF).

Insider Ownership and the Risk Map

Insider ownership, while smaller at around 11.41%, is also very important because it aligns management's interests with yours. The largest individual shareholder is Douglas S. Gordon, who owns 758,377 shares, valued at approximately $11.53 million. When insiders hold this much, they defintely feel the pain or gain alongside you. The risk here is that while the company's turnaround is working-Q3 2025 net income was $7.9 million-insider selling can spook the market. A director did sell 79,872 shares for about $1.21 million in November 2025. While this could be for personal reasons, it's a number you can't ignore, especially as nonperforming assets as a percentage of total assets ticked up to 0.37% at June 30, 2025. It's a classic regional bank trade-off: strong capital returns but a persistent need to manage asset quality in a tough rate environment.

Market Impact and Investor Sentiment

You need to know where the big money is leaning to make your own decision, and for Waterstone Financial, Inc. (WSBF), the institutional picture is a study in controlled neutrality, but the insider view is defintely a warning sign. The consensus among the few analysts covering the stock is a Hold, suggesting you maintain your current position but don't rush to buy more.

Major institutional investors, the ones who manage the world's largest pools of capital, own a significant chunk of the company-roughly 50% to 62.7% of the stock. This high level of institutional ownership usually signals a degree of stability and confidence in the long-term business model, which for Waterstone Financial, Inc. is a mix of community banking and mortgage lending.

Here's the quick math on who holds the most sway:

• BlackRock, Inc. is the largest institutional shareholder, holding approximately 1.72 million shares valued at about $26.10 million.
• Dimensional Fund Advisors LP holds around 1.43 million shares, valued at $21.81 million.
• Vanguard Group Inc. owns about 943,736 shares, a stake valued at $14.34 million.

Still, the overall institutional sentiment is mixed, as evidenced by a net decrease in positions among some major holders in the first half of 2025. For example, BlackRock, Inc. reduced its position by 3.98% as of June 30, 2025, and Dimensional Fund Advisors LP cut theirs by 3.186%. You see the heavyweights trimming their exposure, even as the stock price has been on an upward trend.

Recent Market Reactions and Insider Activity

The stock market has responded positively to Waterstone Financial, Inc.'s improving financial performance in 2025, but you have to weigh that against a clear signal of skepticism from company insiders. The stock price closed at $15.60 on November 21, 2025, reflecting a 2.56% gain on that day alone. Over the past year, the stock has shown a notable increase of 3.87% as of early November 2025, moving from $14.73 to $15.30 per share.

A key technical move occurred recently when the stock crossed above its 200-day moving average of $14.18 on November 19, 2025, which is often seen as a bullish signal for a stock's intermediate-to-long-term trend. However, the insider sentiment is strongly Negative. Over the last year, insiders have sold $10.9 million worth of shares in high-impact open-market transactions, against $0 in purchases. This is a critical divergence from the positive institutional and technical trends.

A director recently sold 79,872 shares for approximately $1.21 million, which is a significant sale that can't be ignored. When the people who know the company best are selling, it suggests they see limits to the near-term upside, regardless of the strong Q3 2025 earnings. This is a classic case of management confidence in operations (aggressive share buybacks and dividend maintenance) versus personal confidence in the stock's valuation.

Analyst Perspectives on Key Investors' Impact

The analyst community's perspective on Waterstone Financial, Inc. is largely one of cautious optimism, which translates into a widespread Hold consensus. This is not a strong buy, but it's not a sell either; it's a wait-and-see rating. The single analyst rating available is a 'Hold (c+)' from Weiss Ratings, reaffirmed in November 2025.

The analysts' neutrality is rooted in the company's solid 2025 financial performance, especially the Community Banking segment, which is offset by the cyclical nature of the Mortgage Banking business. For the quarter ended September 30, 2025, consolidated net income surged to $7.9 million, or $0.45 per diluted share, a 73.1% increase compared to the same quarter in 2024. This earnings strength, driven by improved net interest margin (NIM), is a clear positive. Waterstone Financial, Inc. (WSBF): History, Ownership, Mission, How It Works & Makes Money

The impact of major investors like BlackRock, Inc. is viewed as a stabilizing force, providing liquidity and a baseline valuation. Their presence, despite some trimming of positions, validates the company's book value per share (BVPS), which rose to $18.19 in Q2 2025 from $17.53 at year-end 2024. The analysts acknowledge that management's active share repurchase program is a net positive, reducing the total common shares outstanding to 19,281,000 in 2025, which boosts the book value per share for all investors.

The key takeaway is that the institutional accumulation suggests a solid, if unspectacular, value play, but the insider selling is a risk you must factor into your valuation model. You need to see a reversal in that insider trend before calling this a strong buy.