If you want to know who really controls TMC the metals company Inc. (NASDAQ:TMC), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 52% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Meanwhile, private equity firms make up 18% of the company’s shareholders.
Let's take a closer look to see what the different types of shareholders can tell us about TMC the metals.
NasdaqGS:TMC Ownership Breakdown December 24th 2023
What Does The Institutional Ownership Tell Us About TMC the metals?
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 TMC the metals. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see TMC the metals' historic earnings and revenue below, but keep in mind there's always more to the story.
NasdaqGS:TMC Earnings and Revenue Growth December 24th 2023
Hedge funds don't have many shares in TMC the metals. ERAS Capital, LLC is currently the company's largest shareholder with 18% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 18% and 5.0%, of the shares outstanding, respectively. Gerard Barron, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.
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 TMC the metals
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Shareholders would probably be interested to learn that insiders own shares in TMC the metals company Inc.. In their own names, insiders own US$25m worth of stock in the US$340m 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, who are usually individual investors, hold a substantial 52% stake in TMC the metals, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Private Equity Ownership
Private equity firms hold a 18% stake in TMC the metals. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.
Private Company Ownership
We can see that Private Companies own 18%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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.
