Sound Financial Bancorp's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
A total of 21 investors have a majority stake in the company with 50% ownership
A look at the shareholders of Sound Financial Bancorp, Inc. (NASDAQ:SFBC) can tell us which group is most powerful. The group holding the most number of shares in the company, around 47% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
And institutions on the other hand have a 20% ownership in the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.
In the chart below, we zoom in on the different ownership groups of Sound Financial Bancorp.
NasdaqCM:SFBC Ownership Breakdown December 18th 2024
What Does The Institutional Ownership Tell Us About Sound Financial Bancorp?
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.
Sound Financial Bancorp already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Sound Financial Bancorp's earnings history below. Of course, the future is what really matters.
NasdaqCM:SFBC Earnings and Revenue Growth December 18th 2024
Our data indicates that hedge funds own 16% of Sound Financial Bancorp. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Stilwell Value LLC is currently the company's largest shareholder with 16% of shares outstanding. AllianceBernstein L.P. is the second largest shareholder owning 5.8% of common stock, and Sound Financial Bancorp, Inc, ESOP holds about 5.4% of the company stock. Additionally, the company's CEO Laura Stewart directly holds 3.6% of the total shares outstanding.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 21 shareholders, meaning that no single shareholder has a majority interest in the ownership.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of Sound Financial Bancorp
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 most recent data indicates that insiders own a reasonable proportion of Sound Financial Bancorp, Inc.. It has a market capitalization of just US$136m, and insiders have US$15m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
The general public-- including retail investors -- own 47% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Sound Financial Bancorp has 4 warning signs (and 1 which is significant) we think you should know about.
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.
