QuantumScape Corporation's (NYSE:QS) market cap touched US$2.8b last week, benefiting both individual investors who own 45% as well as institutions

Key Insights

• The considerable ownership by individual investors in QuantumScape indicates that they collectively have a greater say in management and business strategy
• 49% of the business is held by the top 25 shareholders
• Recent sales by insiders

If you want to know who really controls QuantumScape Corporation (NYSE:QS), 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 individual investors with 45% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While individual investors were the group that reaped the most benefits after last week’s 14% price gain, institutions also received a 29% cut.

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

View our latest analysis for QuantumScape

What Does The Institutional Ownership Tell Us About QuantumScape?

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 QuantumScape 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of QuantumScape, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in QuantumScape. Our data shows that Porsche Automobil Holding SE is the largest shareholder with 17% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 6.1% and 3.9%, of the shares outstanding, respectively. Jagdeep Singh, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of QuantumScape

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.

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.

We can see that insiders own shares in QuantumScape Corporation. This is a big company, so it is good to see this level of alignment. Insiders own US$242m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 45% stake in QuantumScape. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

Public companies currently own 17% of QuantumScape stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand QuantumScape better, we need to consider many other factors. Be aware that QuantumScape is showing 3 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

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.