What You Need To Know About Standard Chartered PLC's (LON:STAN) Investor Composition

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Simply Wall St

Tue, May 24, 2022, 12:29 AM 4 min read

If you want to know who really controls Standard Chartered PLC (LON:STAN), then you'll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. We also tend to see lower insider ownership in companies that were previously publicly owned.

With a market capitalization of UK£18b, Standard Chartered is rather large. We'd expect to see institutional investors on the register. Companies of this size are usually well known to retail investors, too. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Standard Chartered.

Check out our latest analysis for Standard Chartered

ownership-breakdown — LSE:STAN Ownership Breakdown May 24th 2022

What Does The Institutional Ownership Tell Us About Standard Chartered?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Standard Chartered 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 Standard Chartered's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth — LSE:STAN Earnings and Revenue Growth May 24th 2022

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Standard Chartered is not owned by hedge funds. The company's largest shareholder is Temasek Holdings (Private) Limited, with ownership of 17%. BlackRock, Inc. is the second largest shareholder owning 7.8% of common stock, and Dodge & Cox holds about 4.1% of the company stock.

A closer look at our ownership figures suggests that the top 14 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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 Standard Chartered

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 data suggests that insiders own under 1% of Standard Chartered PLC in their own names. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own UK£39m of stock. 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 15% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Equity Ownership

Private equity firms hold a 17% stake in Standard Chartered. 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 Standard Chartered better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Standard Chartered you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.