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Do Insiders Own Lots Of Shares In ServisFirst Bancshares, Inc. (NASDAQ:SFBS)?

Simply Wall St

If you want to know who really controls ServisFirst Bancshares, Inc. (NASDAQ:SFBS), then you'll have to look at the makeup of its share registry. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'

ServisFirst Bancshares has a market capitalization of US$1.8b, so we would expect some institutional investors to have noticed the stock. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about SFBS.

View our latest analysis for ServisFirst Bancshares

NasdaqGS:SFBS Ownership Summary, September 17th 2019

What Does The Institutional Ownership Tell Us About ServisFirst Bancshares?

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 ServisFirst Bancshares does have institutional investors; and they hold 48% of the 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at ServisFirst Bancshares's earnings history, below. Of course, the future is what really matters.

NasdaqGS:SFBS Income Statement, September 17th 2019

ServisFirst Bancshares is not owned by hedge funds. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of ServisFirst Bancshares

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 the CEO.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

It seems insiders own a significant proportion of ServisFirst Bancshares, Inc.. It is very interesting to see that insiders have a meaningful US$262m stake in this US$1.8b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 37% ownership, the general public have some degree of sway over SFBS. 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 ServisFirst Bancshares better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.