Scorpio Tankers Inc.'s (NYSE:STNG) high institutional ownership speaks for itself as stock continues to impress, up 4.9% over last week

Key Insights

• Institutions' substantial holdings in Scorpio Tankers implies that they have significant influence over the company's share price
• A total of 24 investors have a majority stake in the company with 51% ownership
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls Scorpio Tankers Inc. (NYSE:STNG), 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 64% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And as as result, institutional investors reaped the most rewards after the company's stock price gained 4.9% last week. One-year return to shareholders is currently 40% and last week’s gain was the icing on the cake.

In the chart below, we zoom in on the different ownership groups of Scorpio Tankers.

View our latest analysis for Scorpio Tankers

What Does The Institutional Ownership Tell Us About Scorpio Tankers?

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.

Scorpio Tankers already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Scorpio Tankers, (below). Of course, keep in mind that there are other factors to consider, too.

Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. We note that hedge funds don't have a meaningful investment in Scorpio Tankers. The company's largest shareholder is Dimensional Fund Advisors LP, with ownership of 7.5%. Scorpio Holdings Limited is the second largest shareholder owning 7.4% of common stock, and BlackRock, Inc. holds about 6.5% of the company stock. Additionally, the company's CEO Emanuele Lauro directly holds 1.2% of the total shares outstanding.

After doing some more digging, we found that the top 24 have the combined ownership of 51% 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 Scorpio Tankers

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.

Our most recent data indicates that insiders own some shares in Scorpio Tankers Inc.. This is a big company, so it is good to see this level of alignment. Insiders own US$290m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 21% stake in Scorpio Tankers. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 7.4%, of the Scorpio Tankers 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 Scorpio Tankers better, we need to consider many other factors. For instance, we've identified 2 warning signs for Scorpio Tankers (1 doesn't sit too well with us) that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.