Institutional investors may adopt severe steps after SouthState Corporation’s (NASDAQ:SSB) latest 5.0% drop adds to a year losses

Important Findings

  • The institutions’ sizable holdings in SouthState imply that they have a significant impact on the company’s share price
  • 50% of the company is held by the 14 largest shareholders
  • Insiders recently sold

If you want to know who really controls SouthState Corporation (NYSE:SOUTH), you need to look at the composition of its stock register. With 82%, institutions own the maximum shares in the company. In other words, the group is exposed to maximum upside (or downside risk).

It follows that institutional investors were the hardest-hit group after the company’s market cap fell 5.0% to $5.7 billion last week following a fall in the share price. The recent loss, which adds to a 10% one-year loss for shareholders, may not sit well with this group of investors. Institutions, also known as “smart money,” have a huge impact on how a stock’s price moves. Therefore, if the decline continues, institutional investors could be pressured to sell SouthState, which could hurt individual investors.

Let’s take a closer look at what the different types of shareholders can tell us about SouthState.

Check out our latest analysis for SouthState

NasdaqGS:SSB ownership breakdown March 12, 2023

What Does Institutional Ownership Tell Us About SouthState?

Institutional investors typically compare their own returns to the returns of a commonly tracked index. As such, they typically consider buying larger companies that are included in the relevant benchmark index.

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As you can see, institutional investors have a significant stake in SouthState. This means that the analysts who work for these institutes have looked at the stock and like it. But just like everyone else, they can be wrong. If several institutes change their opinion on a stock at the same time, the share price could fall quickly. So it’s worth checking out SouthState’s earnings history below. Of course, what really matters is the future.

NasdaqGS:SSB Earnings and Sales Growth March 12, 2023

Institutional investors own over 50% of the company, so collectively they can likely heavily influence board decisions. SouthState is not owned by hedge funds. Our data shows that The Vanguard Group, Inc. is the largest shareholder with 11% of outstanding shares. BlackRock, Inc. is the second largest shareholder with 7.1% of the common stock and T. Rowe Price Group, Inc. owns approximately 4.2% of the company’s stock.

After investigating further, we found that the top 14 collectively own 50% of the company, suggesting that no single shareholder has significant control over the company.

While examining a company’s institutional ownership can add value to your research, it’s also a good practice to research analyst recommendations to gain a deeper understanding of a stock’s expected performance. Quite a few analysts cover the stock, so you can easily look at the projected growth.

Insider ownership by SouthState

The definition of an insider may differ slightly from country to country, but board members always count. Management runs the business, but the CEO is accountable to the board even if he or she is a member.

Insider ownership is positive when it signals leadership thinks like the true owners of the company. However, a high proportion of insiders can give immense power to even a small group within the organization. This can sometimes be negative.

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Shareholders would likely be interested to know that insiders own SouthState Corporation stock. It’s a fairly large company, so it’s generally positive to see potentially meaningful alignment. In this case, they own around $68 million worth of stock (at current prices). Most would say that this shows an alignment of interests between shareholders and the board. Still, it might be worth checking to see if these insiders have sold.

General Public Property

With 16% ownership, the general public, made up primarily of individual investors, has some influence over SouthState. While this ownership size is substantial, it may not be enough to change company policy if the decision is not aligned with other major shareholders.

Next Steps:

While it’s worth considering the different groups that own a business, there are other factors that are even more important. Case in point: We discovered it 1 SouthState warning sign you should be aware of this.

If you’re like me, you might want to think about whether this company is going to grow or shrink. Luckily, you can check out this free report that includes analyst forecasts for the future.

Note: The figures in this article are calculated using data for the last twelve months, relating to the 12-month period ending on the last date of the month to which the financial statements are dated. This may not tally with the annual report figures for the full year.

This Simply Wall St article is of a general nature. We provide comments based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended as financial advice. It is not a recommendation to buy or sell any stock and does not take into account your goals or financial situation. Our goal is to offer you long-term focused analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any of the stocks mentioned.


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