Insiders of Copper Fox Metals Inc. (CVE:CUU) were rewarded after last week’s 17% gain

Key Insights

• Insiders appear to have a vested interest in Copper Fox Metals' growth, as seen by their sizeable ownership
• 57% of the company is held by a single shareholder (Ernesto Echavarria)
• Insiders have bought recently

To get a sense of who is truly in control of Copper Fox Metals Inc. (CVE:CUU), it is important to understand the ownership structure of the business. With 59% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Insiders who purchased recently should be particularly happy after the stock gained 17% in the past week.

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

See our latest analysis for Copper Fox Metals

What Does The Lack Of Institutional Ownership Tell Us About Copper Fox Metals?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Copper Fox Metals, for yourself, below.

Copper Fox Metals is not owned by hedge funds. Ernesto Echavarria is currently the company's largest shareholder with 57% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. With 1.1% and 0.9% of the shares outstanding respectively, Elmer Stewart and R. Mackay-Dunn are the second and third largest shareholders. Interestingly, the bottom two of the top three shareholders also hold the title of Chief Executive Officer and Member of the Board of Directors, respectively, suggesting that these insiders have a personal stake in the company.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Copper Fox 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.

It seems that insiders own more than half the Copper Fox Metals Inc. stock. This gives them a lot of power. That means they own CA$85m worth of shares in the CA$144m company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 40% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 3 warning signs for Copper Fox Metals (2 make us uncomfortable) that you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free 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.