Individual investors invested in TSS, Inc. (NASDAQ:TSSI) up 17% last week, insiders too were rewarded

editorial-team@simplywallst.com (Simply Wall St)

Tue, Dec 31, 2024, 4:04 AM 4 min read

If you want to know who really controls TSS, Inc. (NASDAQ:TSSI), 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 57% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While individual investors were the group that reaped the most benefits after last week’s 17% price gain, insiders also received a 31% cut.

Let's delve deeper into each type of owner of TSS, beginning with the chart below.

View our latest analysis for TSS

ownership-breakdown — NasdaqCM:TSSI Ownership Breakdown December 31st 2024

What Does The Lack Of Institutional Ownership Tell Us About TSS?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. TSS' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

earnings-and-revenue-growth — NasdaqCM:TSSI Earnings and Revenue Growth December 31st 2024

Our data indicates that hedge funds own 12% of TSS. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. MHW Capital Management, LLC is currently the largest shareholder, with 12% of shares outstanding. With 8.3% and 6.6% of the shares outstanding respectively, Norman Pessin and Glen Ikeda are the second and third largest shareholders. In addition, we found that Darryll Dewan, the CEO has 1.4% of the shares allocated to their name.

On studying our ownership data, we found that 13 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of TSS

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems insiders own a significant proportion of TSS, Inc.. Insiders have a US$90m stake in this US$291m business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 57% of TSS shares. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with TSS , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.