Institutions along with retail investors who hold considerable shares inVault Minerals Limited (ASX:VAU) come under pressure; lose 4.3% of holdings value

Key Insights

• The considerable ownership by retail investors in Vault Minerals indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 25 shareholders
• 42% of Vault Minerals is held by Institutions

If you want to know who really controls Vault Minerals Limited (ASX:VAU), 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 48% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 4.3% decrease in the stock price last week, retail investors suffered the most losses, but institutions who own 42% stock also took a hit.

Let's take a closer look to see what the different types of shareholders can tell us about Vault Minerals.

View our latest analysis for Vault Minerals

What Does The Institutional Ownership Tell Us About Vault Minerals?

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.

Vault Minerals already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Vault Minerals' historic earnings and revenue below, but keep in mind there's always more to the story.

Our data indicates that hedge funds own 7.2% of Vault Minerals. 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. Van Eck Associates Corporation is currently the company's largest shareholder with 9.1% of shares outstanding. For context, the second largest shareholder holds about 7.2% of the shares outstanding, followed by an ownership of 6.5% by the third-largest shareholder.

A closer look at our ownership figures suggests that the top 25 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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 Vault Minerals

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Shareholders would probably be interested to learn that insiders own shares in Vault Minerals Limited. This is a big company, so it is good to see this level of alignment. Insiders own AU$27m worth of shares (at current prices). It is good to see this level of investment by insiders. 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 48% stake in Vault Minerals. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Vault Minerals better, we need to consider many other factors. For example, we've discovered 1 warning sign for Vault Minerals that you should be aware of before investing here.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.