What does the ownership structure of Science Applications International Corporation (NYSE: SAIC) look like?

0

If you want to know who actually controls Science Applications International Corporation (NYSE: SAIC), then you’ll need to look at the composition of its share register. Generally speaking, as a company grows, institutions increase their ownership. Conversely, insiders often decrease their ownership over time. Companies that were previously publicly owned tend to have less insider ownership.

With a market cap of $5.2 billion, Science Applications International is pretty big. We expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. Our analysis of societal ownership below shows that institutions own shares in society. Let’s dig deeper into each owner type to learn more about Science Applications International.

NYSE: SAIC Ownership Allocation on August 8, 2022

What does institutional ownership tell us about Science Applications International?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.

Science Applications International already has institutions on the share register. Indeed, they hold a respectable stake in the company. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it’s worth checking out Science Applications International’s revenue history below. Of course, the future is what really matters.

earnings-and-revenue-growth
NYSE: SAIC Earnings and Revenue Growth August 8, 2022

Since institutional investors own more than half of the issued shares, the board will likely have to pay attention to their preferences. We note that hedge funds have no significant investment in Science Applications International. Wellington Management Group LLP is currently the company’s largest shareholder with 10% of the shares outstanding. Meanwhile, the second and third largest shareholders hold 9.3% and 8.8% of the outstanding shares respectively.

We dug a little deeper and found that 10 of the major shareholders make up around 50% of the register, implying that along with the large shareholders, there are a few smaller shareholders, thereby balancing everyone’s interests somewhat.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. There are a reasonable number of analysts covering the stock, so it might be useful to know their overall view on the future.

Insider property of Science Applications International

The definition of an insider may differ slightly from country to country, but board members still matter. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.

Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.

Our most recent data indicates that insiders own less than 1% of Science Applications International Corporation. It’s a big company, so even a small proportionate interest can create alignment between the board and shareholders. In this case, insiders hold $32 million worth of stock. Good to see board members holding stock, but might be worth checking out if these insiders bought.

General public property

The general public, including retail investors, owns 21% of the company’s capital and therefore cannot be easily ignored. While this size of ownership may not be enough to sway a policy decision in their favor, they can still have a collective impact on company policies.

Next steps:

I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. Take risks by example – Science Applications International a 3 warning signs (and 1 that should not be overlooked) we think you should know.

But finally it’s the future, not the past, which will determine the performance of the owners of this company. That’s why we think it’s advisable to take a look at this free report showing whether analysts are predicting a better future.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month the financial statements are dated. This may not be consistent with the annual report figures for the full year.

Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Share.

Comments are closed.