Yahoo Finance Individual investors who have a significant stake must be disappointed along with institutions after Denison Mines Corp.'s (TSE:DML) market cap dropped by CA$134m
Key Insights
The considerable ownership by individual investors in Denison Mines indicates that they collectively have a greater say in management and business strategy
The top 25 shareholders own 32% of the company
If you want to know who really controls Denison Mines Corp. (TSE:DML), 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 60% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
While institutions, who own 40% shares weren’t spared from last week’s CA$134m market cap drop, individual investors as a group suffered the maximum losses
In the chart below, we zoom in on the different ownership groups of Denison Mines.
Check out our latest analysis for Denison Mines
What Does The Institutional Ownership Tell Us About Denison Mines?
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 Denison Mines. 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. 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 Denison Mines, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Denison Mines. Our data shows that ALPS Advisors, Inc. is the largest shareholder with 6.5% of shares outstanding. Mirae Asset Global Investments Co., Ltd. is the second largest shareholder owning 4.4% of common stock, and FMR LLC holds about 4.0% of the company stock.
On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.
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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of Denison Mines
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Our information suggests that Denison Mines Corp. insiders own under 1% of the company. Keep in mind that it's a big company, and the insiders own CA$7.3m worth of shares. The absolute value might be more important than the proportional share. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public -- including retail investors -- own 60% of Denison Mines. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 3 warning signs for Denison Mines you should be aware of, and 1 of them can't be ignored.
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.
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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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
