A look at the shareholders of Sembcorp Marine Ltd (SGX:S51) can tell us which group is most powerful. Institutions often own shares in more established companies, while it' s not unusual to see insiders own a fair bit of smaller companies. Companies that have been privatized tend to have low insider ownership. 

With a market capitalization of S$2.5b, Sembcorp Marine is a decent size, so it is probably on the radar of institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about Sembcorp Marine. 

See our latest analysis for Sembcorp Marine 
SGX:S51 Ownership Breakdown June 11th 2021

What Does The Institutional Ownership Tell Us About Sembcorp Marine?

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. 

As you can see, institutional investors have a fair amount of stake in Sembcorp Marine. 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 Sembcorp Marine' s earnings history below. Of course, the future is what really matters. 
SGX:S51 Earnings and Revenue Growth June 11th 2021

Hedge funds don' t have many shares in Sembcorp Marine. Temasek Holdings (Private) Limited is currently the company' s largest shareholder with 43% of shares outstanding. The Vanguard Group, Inc. is the second largest shareholder owning 1.7% of common stock, and Dimensional Fund Advisors L.P. holds about 1.1% of the company stock. 

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority. 

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. 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 Sembcorp Marine

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 information suggests that Sembcorp Marine Ltd insiders own under 1% of the company. It' s a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own S$18m worth of shares. It is good to see board members owning shares, but it might be worth checking  if those insiders have been buying. 

General Public Ownership

The general public -- including retail investors -- own 51% of Sembcorp Marine. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability. 

Private Equity Ownership

Private equity firms hold a 43% stake in Sembcorp Marine. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public. 

Next Steps:

It' s always worth thinking about the different groups who own shares in a company. But to understand Sembcorp Marine better, we need to consider many other factors. Be aware that  Sembcorp Marine is showing  2 warning signs in our investment analysis  , you should know about... 

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this  freereport 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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