Every investor in Goldquest Mining Corp. (CVE:GQC) should be aware of the most powerful shareholder groups. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said ‘Show me the incentive and I will show you the outcome.
Goldquest Mining is not a large company by global standards. It has a market capitalization of CA$36m, which means it wouldn’t have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it’s seems that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Goldquest Mining.
What Does The Institutional Ownership Tell Us About Goldquest Mining?
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.
As you can see, institutional investors own 8.5% of Goldquest Mining. 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. 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 Goldquest Mining, (below). Of course, keep in mind that there are other factors to consider, too.
Goldquest Mining is not owned by hedge funds. Agnico Eagle Mines Limited is currently the company’s largest shareholder with 15% of shares outstanding. With 8.5% and 3.6% of the shares outstanding respectively, Robert McEwen and Konwave AG are the second and third largest shareholders.
Our studies suggest that the top 17 shareholders collectively control less than 50% of the company’s shares, meaning that the company’s shares are widely disseminated and there is no dominant shareholder.
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 is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Goldquest Mining
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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
It seems insiders own a significant proportion of Goldquest Mining Corp.. It has a market capitalization of just CA$36m, and insiders have CA$4.0m worth of shares in their own names. When analysing a company, looking at ownership may seem a logical place to start. However, there are many other factors to consider, such as the risks within the company itself. For example, we’ve discovered 3 warning signs for Goldquest Mining which any shareholder or potential investor should be aware of.
General Public Ownership
The general public, who are mostly retail investors, collectively hold 66% of Goldquest Mining shares. This size of ownership gives retail investors collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Public Company Ownership
We can see that public companies hold 15%, of the GQC shares on issue. We can’t be certain, but this is quite possible this is a strategic stake. The businesses may be similar, or work together.
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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