What Type Of Shareholders Make Up FPX Nickel Corp.'s (CVE:FPX) Share Registry?

By
Simply Wall St
Published
December 31, 2020

A look at the shareholders of FPX Nickel Corp. (CVE:FPX) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

FPX Nickel is a smaller company with a market capitalization of CA$128m, so it may still be flying under the radar of many institutional investors. In the chart below, we can see that institutions are not on the share registry. Let's delve deeper into each type of owner, to discover more about FPX Nickel.

See our latest analysis for FPX Nickel

TSXV:FPX Ownership Breakdown December 31st 2020

What Does The Lack Of Institutional Ownership Tell Us About FPX Nickel?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

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. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. 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 FPX Nickel, for yourself, below.

TSXV:FPX Earnings and Revenue Growth December 31st 2020

We note that hedge funds don't have a meaningful investment in FPX Nickel. Peter M. Bradshaw is currently the company's largest shareholder with 17% of shares outstanding. Allyn knoche is the second largest shareholder owning 15% of common stock, and 117902 Canada Inc. holds about 4.4% of the company stock.

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 it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of FPX Nickel

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 insiders maintain a significant holding in FPX Nickel Corp.. Insiders own CA$45m worth of shares in the CA$128m company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public -- mostly retail investors -- own 57% of FPX Nickel. 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.

Private Company Ownership

Our data indicates that Private Companies hold 8.1%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with FPX Nickel , and understanding them should be part of your investment process.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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. 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.
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