Key Insights
High institutional ownership means Regions Financial’s share price is sensitive to their trading actions. The top 15 shareholders own 51% of the company. Analyst forecasts and ownership data give us a solid idea of the business’s prospects.
If you want to know who really controls Regions Financial Corporation ( NYSE:RF ), then you’ll have to look at the makeup of its share registry. With 82% of the shares under their belt, institutional investors are the largest holders of the company’s stock. In other words, this group faces the greatest upside potential (or downside risk).
Because institutional investors have vast amounts of capital and liquidity, their investment decisions tend to have a large influence over individual investors. As a result, having a large amount of institutional capital invested in a company is generally seen as a positive thing.
In the chart below, we can zoom in on the different ownership groups for Regions Financial.
Check out our latest analysis for Regions Financial
NYSE:RF Ownership Breakdown September 24, 2024
What does institutional ownership tell us about Regions Financial?
Many institutions measure their performance against an index that approximates the local market, so they usually pay particular attention to companies that are included in major indexes.
Regions Financial already has institutional investors on the share registry. In fact, institutions hold a significant amount of shares in the company. This suggests that there is some credibility among professional investors. However, you can’t rely on this fact alone, as like everyone, institutions make bad investments sometimes. When multiple institutional investors own a stock, there’s always a risk that it will get caught in a ‘crowded trade’. If such a trade goes wrong, multiple parties may compete to sell shares fast. This risk is higher in companies without a history of growth. You can see Regions Financial’s historic earnings and revenue below, but remember there’s always more to the story.
NYSE:RF Earnings and Revenue Growth September 24, 2024
Investors should note that institutional investors actually own more than half of the company’s shares, so collectively they can wield significant power. Hedge funds don’t have many shares in Regions Financial. Looking at our data, we can see that the largest shareholder is The Vanguard Group, Inc., holding 12% of the shares outstanding, while the second and third largest shareholders hold 9.5% and 5.4% of the shares outstanding respectively.
A closer look at our ownership figures shows that the top 15 shareholders have a combined ownership of 51%, meaning no single shareholder has a majority.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiment to know which way the wind is blowing. There are a fair number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership at Regions Financial
The definition of a company insider can be subjective and varies between jurisdictions. Our data reflects individual insiders, and includes, at a minimum, directors. While management runs the company, the CEO is accountable to the board of directors even if he or she is a member of the board.
I generally consider insider ownership to be a good thing, but in some cases it can make it difficult for other shareholders to hold the board to account for decisions.
Our data indicates that insiders own less than 1% of Regions Financial Corporation shares in their own personal names. Since it’s a very large company, it’s unlikely that insiders own a significant portion of the company’s shares. While their holdings are less than 1%, we can see that directors collectively own US$69m worth of shares (at current prices). Recent buying and selling is equally important to consider. To see if insiders have been buying or selling, click here.
General public property
The general public (including retail investors) own 18% of the company’s shares, which is not something that can be easily ignored. While this size of ownership is significant, it may not be enough to change the company’s policy if the decision is not in line 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 dig deeper into how a company has performed in the past, and you can access this free interactive graph showing past earnings, revenue and cash flow.
Ultimately, the future is what matters most, so you can access this free report on analyst forecasts for the company.
Note: The figures in this article are calculated using data from the last 12 months, which refers to the 12-month period ending on the last day of the month in which the financial statements are dated, which may not match the figures in the annual report.
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This article by Simply Wall St is of general nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology, and our articles are not intended as financial advice. It is not a recommendation to buy or sell a stock, and does not take into account your objectives or financial situation. We aim to provide long-term analysis driven by fundamental data. Please 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 herein.
