Science Applications Int'l Corp (SAIC)

[DMOST]

Who Really Owns Science Applications International Corporation (NYSE:SAIC)?


In this analysis, my focus will be on developing a perspective on Science Applications International Corporation’s (NYSE:SAIC) latest ownership structure, a less discussed, but important factor. Ownership structure of a company has been found to affect share performance over time. Since the effect of an active institutional investor with a similar ownership as a passive pension-fund can be vastly different on a company’s corporate governance and accountability of shareholders, investors should take a closer look at SAIC’s shareholder registry.
View our latest analysis for Science Applications International

Institutional Ownership

In SAIC’s case, institutional ownership stands at 67.53%, significant enough to cause considerable price moves in the case of large institutional transactions, especially when there is a low level of public shares available on the market to trade. These moves, at least in the short-term, are generally observed in an institutional ownership mix comprising of active stock pickers, in particular levered hedge funds, which can cause large price swings. In the case of SAIC, investors need not worry about such volatility considering active hedge funds don’t have a significant stake. However, we should dig deeper into SAIC’s ownership structure and find out how other key ownership classes can affect its investment profile.

Insider Ownership

An important group of shareholders are company insiders. Insider ownership has to do more with how the company is managed and less to do with the direct impact of the magnitude of shares trading on the market. A stake of less than 1% in SAIC is relatively small, though at least there is still some alignment of interest with shareholders. A higher level of insider ownership has been found to reflect the choosing of projects with higher return on investments compared to lower returning projects for the sake of expansion. It would also be interesting to check what insiders have been doing with their shareholding recently. Insider buying can be a positive indicator of future performance, but a selling decision can be simply driven by personal financial requirements.

General Public Ownership

A substantial ownership of 31.68% in SAIC is held by the general public. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and potential acquisitions. This is a positive sign for an investor who wants to be involved in key decision-making of the company.

Next Steps:

SAIC’s considerably high level of institutional ownership calls for further analysis into its margin of safety. This will enable shareholders to comfortably invest in the company while avoid getting trapped in a sustained sell-off that is often observed in stocks with this level of institutional participation. However, ownership structure should not be the only determining factor when you’re building an investment thesis for SAIC. Rather, you should be examining fundamental factors such as Science Applications International’s past track record and financial health. I highly recommend you to complete your research
by taking a look at the following:

Future Outlook: What are well-informed industry analysts predicting for SAIC’s future growth? Take a look at our free research report of analyst consensus for SAIC’s outlook.

Past Track Record: Has SAIC been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look at the free visual representations of SAIC’s historicals for more clarity.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
https://finance.yahoo.com/news/really-owns-science-applications-international-190443516.html

"PEACE"