Scandinavian Enviro Systems AB (publ)'s (STO:SES) market cap dropped kr166m last week; individual investors who hold 54% were hit as were institutions

Key Insights

• The considerable ownership by retail investors in Scandinavian Enviro Systems indicates that they collectively have a greater say in management and business strategy
• A total of 25 investors have a majority stake in the company with 46% ownership
• 26% of Scandinavian Enviro Systems is held by Institutions

A look at the shareholders of Scandinavian Enviro Systems AB (publ) (STO:SES) can tell us which group is most powerful. The group holding the most number of shares in the company, around 54% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions who own 26% came under pressure after market cap dropped to kr1.4b last week,retail investors took the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Scandinavian Enviro Systems.

View our latest analysis for Scandinavian Enviro Systems

What Does The Institutional Ownership Tell Us About Scandinavian Enviro Systems?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Scandinavian Enviro Systems. 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 Scandinavian Enviro Systems' historic earnings and revenue below, but keep in mind there's always more to the story.

Scandinavian Enviro Systems is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Compagnie Générale des Établissements Michelin Société en commandite par actions with 16% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.1% and 3.7% of the stock.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Scandinavian Enviro Systems

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 most recent data indicates that insiders own some shares in Scandinavian Enviro Systems AB (publ). It has a market capitalization of just kr1.4b, and insiders have kr36m worth of shares, in their own names. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 54% stake in Scandinavian Enviro Systems, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Public Company Ownership

It appears to us that public companies own 16% of Scandinavian Enviro Systems. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - Scandinavian Enviro Systems has 4 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.