State or government account for 51% of St. Galler Kantonalbank AG's (VTX:SGKN) ownership, while individual investors account for 38%

editorial-team@simplywallst.com (Simply Wall St)

Mon, Jan 15, 2024, 9:46 PM 4 min read

Key Insights

The considerable ownership by state or government in St. Galler Kantonalbank indicates that they collectively have a greater say in management and business strategy
51% of the company is held by a single shareholder (Canton of St.Gallen)
Institutional ownership in St. Galler Kantonalbank is 11%

A look at the shareholders of St. Galler Kantonalbank AG (VTX:SGKN) can tell us which group is most powerful. With 51% stake, state or government possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors, on the other hand, account for 38% of the company's stockholders.

Let's delve deeper into each type of owner of St. Galler Kantonalbank, beginning with the chart below.

See our latest analysis for St. Galler Kantonalbank

ownership-breakdown — SWX:SGKN Ownership Breakdown January 16th 2024

What Does The Institutional Ownership Tell Us About St. Galler Kantonalbank?

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.

St. Galler Kantonalbank 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. 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 St. Galler Kantonalbank, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth — SWX:SGKN Earnings and Revenue Growth January 16th 2024

We note that hedge funds don't have a meaningful investment in St. Galler Kantonalbank. Looking at our data, we can see that the largest shareholder is Canton of St.Gallen with 51% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. For context, the second largest shareholder holds about 1.7% of the shares outstanding, followed by an ownership of 1.6% by the third-largest shareholder.

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. 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 St. Galler Kantonalbank

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 less than 1% of St. Galler Kantonalbank AG. Keep in mind that it's a big company, and the insiders own CHF13m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 38% 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.