Retail investors who have a significant stake must be disappointed along with institutions after WM Technology, Inc.'s (NASDAQ:MAPS) market cap dropped by US$23m

Key Insights

• The considerable ownership by retail investors in WM Technology indicates that they collectively have a greater say in management and business strategy
• 47% of the business is held by the top 25 shareholders
• Recent sales by insiders

To get a sense of who is truly in control of WM Technology, Inc. (NASDAQ:MAPS), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 48% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of retail investors took a hit after last week’s 18% price drop, institutions with their 40% holdings also suffered.

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

Check out our latest analysis for WM Technology

What Does The Institutional Ownership Tell Us About WM Technology?

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.

As you can see, institutional investors have a fair amount of stake in WM Technology. 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. 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 WM Technology, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in WM Technology. Our data shows that Morgan Stanley, Investment Banking and Brokerage Investments is the largest shareholder with 6.2% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.3% and 5.2% of the stock. Furthermore, CEO Douglas Francis is the owner of 4.9% of the company's shares.

Our studies suggest that the top 25 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 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. 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 WM Technology

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.

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.

Our most recent data indicates that insiders own a reasonable proportion of WM Technology, Inc.. Insiders own US$25m worth of shares in the US$208m company. 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

The general public-- including retail investors -- own 48% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand WM Technology better, we need to consider many other factors. For example, we've discovered 1 warning sign for WM Technology that you should be aware of before investing here.

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.