Sibanye Stillwater Limited (JSE:SSW) institutional owners may be pleased with recent gains after 29% loss over the past year
Key Insights
Institutions' substantial holdings in Sibanye Stillwater implies that they have significant influence over the company's share price
45% of the business is held by the top 25 shareholders
A look at the shareholders of Sibanye Stillwater Limited (JSE:SSW) can tell us which group is most powerful. The group holding the most number of shares in the company, around 53% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
After a year of 29% losses, last week’s 8.5% gain would be welcomed by institutional investors as a likely sign that returns might start trending higher.
In the chart below, we zoom in on the different ownership groups of Sibanye Stillwater.
Check out our latest analysis for Sibanye Stillwater
What Does The Institutional Ownership Tell Us About Sibanye Stillwater?
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.
Sibanye Stillwater already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Sibanye Stillwater's historic earnings and revenue below, but keep in mind there's always more to the story.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Sibanye Stillwater is not owned by hedge funds. Public Investment Corporation Limited is currently the company's largest shareholder with 15% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.7% and 4.7% of the stock.
A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Sibanye Stillwater
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
Our information suggests that Sibanye Stillwater Limited insiders own under 1% of the company. Keep in mind that it's a big company, and the insiders own R536m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General Public Ownership
The general public, who are usually individual investors, hold a 44% stake in Sibanye Stillwater. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Sibanye Stillwater better, we need to consider many other factors. Take risks for example - Sibanye Stillwater has 2 warning signs we think you should be aware of.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check 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.
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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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