Behind Institutional Investors’ Holdings in Southern Company
SO’s institutional holdings
Institutional investors slightly decreased their positions in Southern Company (SO) in 2Q16, as compared to where they stood on March 31, 2016. Meanwhile, the percentage of float held in Southern Company by institutional investors has decreased by 0.7% in the second quarter, as compared to on March 31. Remember, the “float” of a company refers to the number of shares that are available for trading.
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What does this mean?
The long position additions of institutional investors mostly depict market bullishness on a stock and vice versa. For SO, the number of buyers increased by ~4% in 2Q16, while the number of sellers increased by ~0.6% in the same period over 1Q16. The number of new buyers increased by 4.6%, and the number of sell-offs took a dip by 27%.
Notably, the percentage of float held by institutional investors in SO has shrunk from 52.4% at the end of 1Q16 to ~51.7% as of June 19, 2016. Vanguard, Blackrock, and State Street are the top three institutions holding Southern Company as of June 19, 2016.
Southern Company’s premium dividend yield could be an added highlight to attract institutional investors. The company’s stable earnings and its focus on regulated operations are plus points that institutional investors could be attracted to.
Utilities—particularly regulated ones (PPL)(DUK)—may also see increased inflows in the short term as the UK’s Brexit has called for value plays. We may get to see long position additions in utilities from institutional investors as well.
In the next and final part, we’ll discuss analyst recommendations and price targets for SO going forward.