Both individual investors who control a good portion of TXO Partners, L.P. (NYSE:TXO) along with institutions must be dismayed after last week's 14% decrease

Key Insights

• Significant control over TXO Partners by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 17 shareholders own 50% of the company
• Insider ownership in TXO Partners is 25%

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

Every investor in TXO Partners, L.P. (NYSE:TXO) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 45% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 14% decrease in the stock price last week, individual investors suffered the most losses, but institutions who own 30% stock also took a hit.

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

Check out our latest analysis for TXO Partners

What Does The Institutional Ownership Tell Us About TXO Partners?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in TXO Partners. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 TXO Partners' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in TXO Partners. Bob Simpson is currently the company's largest shareholder with 11% of shares outstanding. In comparison, the second and third largest shareholders hold about 10% and 6.2% of the stock. Furthermore, CEO Brent Clum is the owner of 0.9% of the company's shares.

After doing some more digging, we found that the top 17 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of TXO Partners

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.

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 most recent data indicates that insiders own a reasonable proportion of TXO Partners, L.P.. Insiders have a US$177m stake in this US$701m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over TXO Partners. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand TXO Partners better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for TXO Partners you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company .

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.