Retail investors in Atlantic Lithium Limited (LON:ALL) are its biggest bettors, and their bets paid off as stock gained 10% last week

Key Insights

• Significant control over Atlantic Lithium by retail investors implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 7 shareholders
• Insiders have been buying lately

If you want to know who really controls Atlantic Lithium Limited (LON:ALL), 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 40% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, retail investors benefitted the most after the company's market cap rose by UK£14m last week.

In the chart below, we zoom in on the different ownership groups of Atlantic Lithium.

See our latest analysis for Atlantic Lithium

What Does The Institutional Ownership Tell Us About Atlantic Lithium?

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.

We can see that Atlantic Lithium does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Atlantic Lithium's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Atlantic Lithium. The company's largest shareholder is Assore Holdings Proprietary Limited, with ownership of 28%. Piedmont Lithium Inc. is the second largest shareholder owning 8.8% of common stock, and DGR Global Limited holds about 6.4% of the company stock.

We did some more digging and found that 7 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 Atlantic Lithium

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. 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.

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.

We can see that insiders own shares in Atlantic Lithium Limited. It has a market capitalization of just UK£156m, and insiders have UK£12m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board, though we generally prefer to see bigger insider holdings. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 40% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Atlantic Lithium. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 28%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Public Company Ownership

It appears to us that public companies own 15% of Atlantic Lithium. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Atlantic Lithium better, we need to consider many other factors. For instance, we've identified 2 warning signs for Atlantic Lithium (1 is a bit unpleasant) that you should be aware of.

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.