Every investor in Commercial Metals Company (NYSE:CMC) should know the most powerful shareholder groups. Big companies usually have institutions as shareholders, and we usually see insiders owning shares in small companies. Companies that were previously publicly owned tend to have less insider ownership.
With a market cap of $4.1 billion, Commercial Metals is pretty big. We expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. In the graph below, we can see that the institutions own shares in the company. Let’s dig deeper into each owner type to learn more about Commercial Metals.
Check out our latest analysis for commercial metals
What does institutional ownership tell us about commercial metals?
Institutional investors typically compare their own returns to the returns of a commonly tracked index. They therefore generally consider buying larger companies that are included in the relevant benchmark.
We can see that Commercial Metals has institutional investors; and they own a good part of the shares of the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. It is not uncommon to see a sharp decline in the stock price if two large institutional investors attempt to sell a stock at the same time. So it’s worth checking out Commercial Metals’ past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.
Investors should note that institutions actually own more than half of the company, so they can collectively wield significant power. Commercial Metals does not belong to hedge funds. Our data shows that BlackRock, Inc. is the largest shareholder with 12% of shares outstanding. With 11% and 8.0% of the shares outstanding, respectively, The Vanguard Group, Inc. and FMR LLC are the second and third largest shareholders.
Upon closer inspection, we found that more than half of the company’s shares are held by the top 9 shareholders, suggesting that the interests of the larger shareholders are to some extent balanced by those of the smaller ones.
Institutional ownership research is a good way to assess and filter a stock’s expected performance. The same can be obtained by studying the feelings of the analyst. There are a reasonable number of analysts covering the stock, so it might be useful to know their overall view on the future.
Trading Metals Insider Ownership
The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.
Shareholders would likely be interested to learn that insiders hold shares of Commercial Metals Company. It’s a pretty big company, so it’s generally a positive to see a potentially meaningful alignment. In this case, they own about $54 million worth of stock (at today’s prices). It’s good to see this level of investment by insiders. You can check here if these insiders have bought recently.
General public property
With an 11% stake, the general public, consisting primarily of individual investors, has some influence over Commercial Metals. This size of ownership, although considerable, may not be sufficient to change company policy if the decision is not in line with other large shareholders.
I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. For example, we found 4 warning signs for commercial metals (2 should not be ignored!) which you should be aware of before investing here.
If you prefer to find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
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