If you want to know who really controls STORE Capital Corporation (NYSE:STOR), 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 80% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And so it follows that institutional investors was the group most impacted after the company’s market cap fell to US$8.0b last week after a 3.4% drop in the share price. This set of investors may especially be concerned about the current loss, which adds to a one-year loss of 16% for shareholders. Also referred to as “smart money”, institutions have a lot of sway over how a stock’s price moves. As a result, if the downtrend continues, institutions may face pressures to sell STORE Capital, which might have negative implications on individual investors.
Let’s take a closer look to see what the different types of shareholders can tell us about STORE Capital.
View our latest analysis for STORE Capital
NYSE:STOR Ownership Breakdown August 20th 2022
What Does The Institutional Ownership Tell Us About STORE Capital?
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.
We can see that STORE Capital does have institutional investors; and they hold a good portion of the company’s stock. 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 STORE Capital, (below). Of course, keep in mind that there are other factors to consider, too.
NYSE:STOR Earnings and Revenue Growth August 20th 2022
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. We note that hedge funds don’t have a meaningful investment in STORE Capital. The company’s largest shareholder is The Vanguard Group, Inc., with ownership of 14%. Meanwhile, the second and third largest shareholders, hold 9.9% and 5.5%, of the shares outstanding, respectively.
Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 13 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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 STORE Capital
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 STORE Capital Corporation in their own names. It’s a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own US$75m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.
General Public Ownership
The general public– including retail investors — own 16% 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.
While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we’ve identified 3 warning signs for STORE Capital (1 is potentially serious) that you should be aware of.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.
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