Key Insights

• The considerable ownership by individual investors in Nordic American Tankers indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 37% of the company
• Institutional ownership in Nordic American Tankers is 41%

If you want to know who really controls Nordic American Tankers Limited (NYSE:NAT), then you'll have to look at the makeup of its share registry. With 56% stake, individual investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While the holdings of individual investors took a hit after last week’s 9.8% price drop, institutions with their 41% holdings also suffered.

Let's take a closer look to see what the different types of shareholders can tell us about Nordic American Tankers.

See our latest analysis for Nordic American Tankers

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

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.

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.

Hedge funds don't have many shares in Nordic American Tankers. Dimensional Fund Advisors LP is currently the largest shareholder, with 5.8% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 5.6% of common stock, and Morgan Stanley, Investment Banking and Brokerage Investments holds about 2.7% of the company stock. Additionally, the company's CEO Herbjorn Hansson directly holds 2.0% of the total shares outstanding.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Nordic American Tankers

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

We can report that insiders do own shares in Nordic American Tankers Limited. As individuals, the insiders collectively own US$19m worth of the US$560m company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public -- including retail investors -- own 56% of Nordic American Tankers. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Nordic American Tankers is showing 3 warning signs in our investment analysis , and 1 of those is potentially serious...

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.