The big shareholder groups in Sintana Energy Inc. (CVE:SEI) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in 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.
Sintana Energy is not a large company by global standards. It has a market capitalization of CA$20m, which means it wouldn’t have the attention of many institutional investors. In the chart below, we can see that institutions don’t own many shares in the company. We can zoom in on the different ownership groups, to learn more about Sintana Energy.
What Does The Institutional Ownership Tell Us About Sintana Energy?
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.
Since institutions own under 5% of Sintana Energy, many may not have spent much time considering the stock. But it’s clear that some have; and they liked it enough to buy in. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.
Sintana Energy is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Robert Bose with 6.7% of shares outstanding. Next, we have Douglas Manner and Keith Spickelmier as the second and third largest shareholders, holding 1.9% and 1.8%, of the shares outstanding, respectively. They also happen to be Chief Executive Officer and Chairman of the Board, respectively. That is, insiders feature higher up in the heirarchy of the company’s top shareholders.
On studying our ownership data, we found that 10 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock’s expected performance. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Sintana Energy
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
It seems insiders own a significant proportion of Sintana Energy Inc.. Insiders own CA$2.4m worth of shares in the CA$20m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.
General Public Ownership
The general public, who are mostly retail investors, collectively hold 85% of Sintana Energy shares. This size of ownership gives retail investors collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
It’s always worth thinking about the different groups who own shares in a company. But to understand Sintana Energy better, we need to consider many other factors. Case in point: We’ve spotted 3 warning signs for Sintana Energy you should be aware of, and 1 of them makes us a bit uncomfortable.
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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.
If you spot an error that warrants correction, please contact the editor at email@example.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.
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