While insiders own 26% of Strickland Metals Limited (ASX:STK), individual investors are its largest shareholders with 58% ownership

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

Sat, Jun 8, 2024, 4:34 PM 4 min read

If you want to know who really controls Strickland Metals Limited (ASX:STK), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 58% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual insiders on the other hand have a 26% ownership in the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.

In the chart below, we zoom in on the different ownership groups of Strickland Metals.

View our latest analysis for Strickland Metals

ownership-breakdown — ASX:STK Ownership Breakdown June 8th 2024

What Does The Institutional Ownership Tell Us About Strickland 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.

Institutions have a very small stake in Strickland Metals. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

earnings-and-revenue-growth — ASX:STK Earnings and Revenue Growth June 8th 2024

Hedge funds don't have many shares in Strickland Metals. Looking at our data, we can see that the largest shareholder is the CEO Andrew Bray with 9.6% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.8% and 4.2% of the stock.

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.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Strickland Metals

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our most recent data indicates that insiders own a reasonable proportion of Strickland Metals Limited. Insiders have a AU$57m stake in this AU$224m 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, who are usually individual investors, hold a substantial 58% stake in Strickland 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 Company Ownership

It seems that Private Companies own 12%, of the Strickland Metals stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Strickland Metals better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Strickland Metals (at least 2 which shouldn't be ignored) , and understanding them should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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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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.