Yahoo Finance Public companies who have a significant stake must be disappointed along with institutions after Ivanhoe Mines Ltd.'s (TSE:IVN) market cap dropped by CA$813m
To get a sense of who is truly in control of Ivanhoe Mines Ltd. (TSE:IVN), it is important to understand the ownership structure of the business. We can see that public companies own the lion's share in the company with 40% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
While institutions who own 30% came under pressure after market cap dropped to CA$11b last week,public companies took the most losses.
Let's delve deeper into each type of owner of Ivanhoe Mines, beginning with the chart below.
See our latest analysis for Ivanhoe Mines
What Does The Institutional Ownership Tell Us About Ivanhoe Mines?
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.
Ivanhoe Mines already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Ivanhoe Mines' earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Ivanhoe Mines. Our data shows that CITIC Limited is the largest shareholder with 26% of shares outstanding. With 14% and 14% of the shares outstanding respectively, Zijin Mining Group Company Limited and Robert Martin Friedland are the second and third largest shareholders. Robert Martin Friedland, who is the third-largest shareholder, also happens to hold the title of Co-Chairman of the Board.
A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.
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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Ivanhoe Mines
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.
Our most recent data indicates that insiders own a reasonable proportion of Ivanhoe Mines Ltd.. It has a market capitalization of just CA$11b, and insiders have CA$1.5b worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 16% stake in Ivanhoe Mines. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Public Company Ownership
Public companies currently own 40% of Ivanhoe Mines stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Ivanhoe Mines better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Ivanhoe Mines you should be aware of.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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.
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