How Many St Barbara Limited (ASX:SBM) Shares Do Institutions Own?

By
Simply Wall St
Published
November 13, 2021
ASX:SBM
Source: Shutterstock

Every investor in St Barbara Limited (ASX:SBM) should be aware of the most powerful shareholder groups. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. We also tend to see lower insider ownership in companies that were previously publicly owned.

St Barbara isn't enormous, but it's not particularly small either. It has a market capitalization of AU$1.1b, which means it would generally expect to see some institutions on the share registry. Taking a look at our data on the ownership groups (below), it seems that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about St Barbara.

View our latest analysis for St Barbara

ownership-breakdown
ASX:SBM Ownership Breakdown November 13th 2021

What Does The Institutional Ownership Tell Us About St Barbara?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that St Barbara does have institutional investors; and they hold a good portion of the company's stock. 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 St Barbara's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
ASX:SBM Earnings and Revenue Growth November 13th 2021

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don't have a meaningful investment in St Barbara. Van Eck Associates Corporation is currently the largest shareholder, with 9.9% of shares outstanding. L1 Capital Pty. Limited is the second largest shareholder owning 7.6% of common stock, and LSV Asset Management holds about 4.9% of the company stock.

After doing some more digging, we found that the top 14 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of St Barbara

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our data suggests that insiders own under 1% of St Barbara Limited in their own names. However, it's possible that insiders might have an indirect interest through a more complex structure. It has a market capitalization of just AU$1.1b, and the board has only AU$3.7m worth of shares in their own names. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

With a 41% ownership, the general public have some degree of sway over St Barbara. 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 St Barbara better, we need to consider many other factors. For instance, we've identified 1 warning sign for St Barbara that 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.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.