Institutional investors may overlook SpareBank 1 Sørøst-Norge's (OB:SOON) recent kr705m market cap drop as long-term gains remain positive

Key Insights

• Given the large stake in the stock by institutions, SpareBank 1 Sørøst-Norge's stock price might be vulnerable to their trading decisions
• 51% of the business is held by the top 3 shareholders
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls SpareBank 1 Sørøst-Norge (OB:SOON), then you'll have to look at the makeup of its share registry. We can see that institutions own the lion's share in the company with 70% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

No shareholder likes losing money on their investments, especially institutional investors who saw their holdings drop 7.2% in value last week. However, the 37% one-year returns may have helped alleviate their overall losses. But they would probably be wary of future losses.

Let's delve deeper into each type of owner of SpareBank 1 Sørøst-Norge, beginning with the chart below.

See our latest analysis for SpareBank 1 Sørøst-Norge

What Does The Institutional Ownership Tell Us About SpareBank 1 Sørøst-Norge?

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.

SpareBank 1 Sørøst-Norge 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. 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 SpareBank 1 Sørøst-Norge's earnings history below. Of course, the future is what really matters.

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. SpareBank 1 Sørøst-Norge is not owned by hedge funds. Our data shows that Sparebankstiftelsen Telemark - Holla Og Lunde, Endowment Arm is the largest shareholder with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 17% and 13% of the stock.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of SpareBank 1 Sørøst-Norge

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 data suggests that insiders own under 1% of SpareBank 1 Sørøst-Norge in their own names. However, it's possible that insiders might have an indirect interest through a more complex structure. It appears that the board holds about kr4.2m worth of stock. This compares to a market capitalization of kr9.1b. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 26% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

It seems that Private Companies own 4.7%, of the SpareBank 1 Sørøst-Norge stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand SpareBank 1 Sørøst-Norge better, we need to consider many other factors. Take risks for example - SpareBank 1 Sørøst-Norge has 1 warning sign we think you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.