What Kind Of Shareholder Owns Most AMG Advanced Metallurgical Group N.V. (AMS:AMG) Stock?

The big shareholder groups in AMG Advanced Metallurgical Group N.V. (AMS:AMG) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

With a market capitalization of €366m, AMG Advanced Metallurgical Group is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions are noticeable on the share registry. Let's delve deeper into each type of owner, to discover more about AMG Advanced Metallurgical Group.

View our latest analysis for AMG Advanced Metallurgical Group

What Does The Institutional Ownership Tell Us About AMG Advanced Metallurgical Group?

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.

We can see that AMG Advanced Metallurgical Group does have institutional investors; and they hold 37% of the stock. 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 AMG Advanced Metallurgical Group's historic earnings and revenue, below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in AMG Advanced Metallurgical Group. Looking at our data, we can see that the largest shareholder is NN Investment Partners International Holdings B.V. with 5.6% of shares outstanding. With 3.6% and 3.2% of the shares outstanding respectively, Heinz Schimmelbusch and Invesco Ltd. are the second and third largest shareholders. Heinz Schimmelbusch also happens to hold the title of Chief Executive Officer.

Our studies suggest that the top 25 shareholders collectively control less than 50% 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 AMG Advanced Metallurgical Group

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

I can report that insiders do own shares in AMG Advanced Metallurgical Group N.V.. As individuals, the insiders collectively own €20m worth of the €366m company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are mostly retail investors, collectively hold 58% of AMG Advanced Metallurgical Group shares. 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.

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 AMG Advanced Metallurgical Group (at least 1 which makes us a bit uncomfortable) , 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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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