Yahoo Finance Institutional investors have a lot riding on SilverCrest Metals Inc. (TSE:SIL) with 55% ownership
Key Insights
Given the large stake in the stock by institutions, SilverCrest Metals' stock price might be vulnerable to their trading decisions
A total of 25 investors have a majority stake in the company with 45% ownership
If you want to know who really controls SilverCrest Metals Inc. (TSE:SIL), then you'll have to look at the makeup of its share registry. We can see that institutions own the lion's share in the company with 55% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
And last week, institutional investors ended up benefitting the most after the company hit CA$1.9b in market cap. The one-year return on investment is currently 38% and last week's gain would have been more than welcomed.
Let's delve deeper into each type of owner of SilverCrest Metals, beginning with the chart below.
See our latest analysis for SilverCrest Metals
What Does The Institutional Ownership Tell Us About SilverCrest Metals?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that SilverCrest Metals does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 SilverCrest Metals' historic earnings and revenue below, but keep in mind there's always more to the story.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. SilverCrest Metals is not owned by hedge funds. Our data shows that Van Eck Associates Corporation is the largest shareholder with 11% of shares outstanding. Sprott Inc. is the second largest shareholder owning 5.4% of common stock, and Gilder Gagnon Howe & Co. LLC holds about 3.8% of the company stock.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of SilverCrest Metals
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
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.
Our most recent data indicates that insiders own some shares in SilverCrest Metals Inc.. This is a big company, so it is good to see this level of alignment. Insiders own CA$22m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 42% stake in SilverCrest Metals. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand SilverCrest Metals better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for SilverCrest Metals you should be aware of, and 1 of them is potentially serious.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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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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.
