While institutions invested in Major Drilling Group International Inc. (TSE:MDI) benefited from last week's 22% gain, retail investors stood to gain the most

Key Insights

• The considerable ownership by retail investors in Major Drilling Group International indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 40% of the company
• Insiders have sold recently

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If you want to know who really controls Major Drilling Group International Inc. (TSE:MDI), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are retail investors with 58% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Retail investors gained the most after market cap touched CA$1.0b last week, while institutions who own 41% also benefitted.

In the chart below, we zoom in on the different ownership groups of Major Drilling Group International.

Check out our latest analysis for Major Drilling Group International

What Does The Institutional Ownership Tell Us About Major Drilling Group International?

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.

Major Drilling Group International 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Major Drilling Group International's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Major Drilling Group International. The company's largest shareholder is FMR LLC, with ownership of 8.7%. With 7.1% and 4.6% of the shares outstanding respectively, Royce & Associates, LP and Beutel Goodman & Company Ltd. are the second and third largest shareholders.

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 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Major Drilling Group International

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.

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.

Our information suggests that Major Drilling Group International Inc. insiders own under 1% of the company. It appears that the board holds about CA$3.3m worth of stock. This compares to a market capitalization of CA$1.0b. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 58% stake in Major Drilling Group International, suggesting it is a fairly popular stock. 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. Be aware that Major Drilling Group International is showing 2 warning signs in our investment analysis , you should know about...

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.