Institutions' substantial holdings in Genco Shipping & Trading implies that they have significant influence over the company's share price
The top 19 shareholders own 50% of the company
Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
Every investor in Genco Shipping & Trading Limited (NYSE:GNK) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 69% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Because institutional owners have a huge pool of resources and liquidity, their investing decisions tend to carry a great deal of weight, especially with individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
In the chart below, we zoom in on the different ownership groups of Genco Shipping & Trading.
What Does The Institutional Ownership Tell Us About Genco Shipping & Trading?
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.
We can see that Genco Shipping & Trading does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Genco Shipping & Trading's earnings history below. Of course, the future is what really matters.
NYSE:GNK Earnings and Revenue Growth October 7th 2024
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Hedge funds don't have many shares in Genco Shipping & Trading. BlackRock, Inc. is currently the largest shareholder, with 10% of shares outstanding. Dimensional Fund Advisors LP is the second largest shareholder owning 6.7% of common stock, and The Vanguard Group, Inc. holds about 3.6% of the company stock. In addition, we found that John Wobensmith, the CEO has 1.1% of the shares allocated to their name.
After doing some more digging, we found that the top 19 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Genco Shipping & Trading
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 most recent data indicates that insiders own some shares in Genco Shipping & Trading Limited. As individuals, the insiders collectively own US$17m worth of the US$788m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public, who are usually individual investors, hold a 28% stake in Genco Shipping & Trading. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Genco Shipping & Trading better, we need to consider many other factors. For example, we've discovered 3 warning signs for Genco Shipping & Trading (1 is a bit unpleasant!) that you should be aware of before investing here.
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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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.
