retail investors who own 54% along with institutions invested in Nordic American Tankers Limited (NYSE:NAT) saw increase in their holdings value last week

Key Insights

• Significant control over Nordic American Tankers by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 39% of the company
• 42% of Nordic American Tankers is held by Institutions

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To get a sense of who is truly in control of Nordic American Tankers Limited (NYSE:NAT), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 54% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that benefitted the most from last week’s US$68m market cap gain, institutions too had a 42% share in those profits.

In the chart below, we zoom in on the different ownership groups of Nordic American Tankers.

See our latest analysis for Nordic American Tankers

What Does The Institutional Ownership Tell Us About Nordic American Tankers?

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.

As you can see, institutional investors have a fair amount of stake in Nordic American Tankers. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Nordic American Tankers, (below). Of course, keep in mind that there are other factors to consider, too.

Nordic American Tankers is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is BlackRock, Inc. with 5.7% of shares outstanding. For context, the second largest shareholder holds about 5.4% of the shares outstanding, followed by an ownership of 2.5% by the third-largest shareholder. Additionally, the company's CEO Herbjorn Hansson directly holds 2.2% of the total shares outstanding.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where 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 sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Nordic American Tankers

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can see that insiders own shares in Nordic American Tankers Limited. In their own names, insiders own US$32m worth of stock in the US$731m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 54% of Nordic American Tankers. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Nordic American Tankers better, we need to consider many other factors. For instance, we've identified 4 warning signs for Nordic American Tankers (2 are significant) that you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.