Tectonic Metals Inc.’s (CVE:TECT) biggest owners are individual investors who got richer after stock soared 101% last week

Key Insights

• The considerable ownership by individual investors in Tectonic Metals indicates that they collectively have a greater say in management and business strategy
• A total of 11 investors have a majority stake in the company with 45% ownership
• 12% of Tectonic Metals is held by Institutions

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If you want to know who really controls Tectonic Metals Inc. (CVE:TECT), 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 55% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, individual investors benefitted the most after the company’s market cap rose by CA$142m last week.

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

View our latest analysis for Tectonic Metals

What Does The Institutional Ownership Tell Us About Tectonic Metals?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Tectonic Metals already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Tectonic Metals, (below). Of course, keep in mind that there are other factors to consider, too.

It would appear that 31% of Tectonic Metals shares are controlled by hedge funds. 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. Our data shows that Crescat Portfolio Management LLC is the largest shareholder with 16% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 16% and 6.3%, of the shares outstanding, respectively. In addition, we found that Antonio Reda, the CEO has 0.5% of the shares allocated to their name.

Our studies suggest that the top 11 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 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. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Tectonic Metals

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

We can report that insiders do own shares in Tectonic Metals Inc.. In their own names, insiders own CA$2.9m worth of stock in the CA$222m company. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 55% stake in Tectonic Metals, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Next Steps:

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. Consider risks, for instance. Every company has them, and we’ve spotted 4 warning signs for Tectonic Metals you should know about.

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.