A look at the shareholders of Globe Metals & Mining Limited ( ASX:GBE ) can tell us which group is most powerful. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.'
With a market capitalization of AU$7.0m, Globe Metals & Mining is a small cap stock, so it might not be well known by many institutional investors. In the chart below below, we can see that institutions don't own shares in the company. We can zoom in on the different ownership groups, to learn more about GBE.
What Does The Lack Of Institutional Ownership Tell Us About Globe Metals & Mining?
Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.
There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to fund under management, so the institition does not bother to look closely at the company. Alternatively, there might be something about the company that has kept institutional investors away. Globe Metals & Mining's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
Hedge funds don't have many shares in Globe Metals & Mining. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Globe Metals & Mining
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
It seems that insiders own more than half the Globe Metals & Mining Limited stock. This gives them a lot of power. Given it has a market cap of AU$7.0m, that means they have AU$3.9m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish to discover (for free) if they have been buying or selling.
General Public Ownership
With a 17% ownership, the general public have some degree of sway over GBE. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
We can see that Private Companies own 26%, 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.
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.
I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph .
Of course this may not be the best stock to buy . So take a peek at this free free list of interesting companies.
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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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.