Insiders appear to have a vested interest in TomTom's growth, as seen by their sizeable ownership
51% of the business is held by the top 5 shareholders
A look at the shareholders of TomTom N.V. (AMS:TOM2) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 52% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And insiders own the top position in the company’s share registry despite recent sales.
Let's delve deeper into each type of owner of TomTom, beginning with the chart below.
What Does The Institutional Ownership Tell Us About TomTom?
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.
We can see that TomTom 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see TomTom's historic earnings and revenue below, but keep in mind there's always more to the story.
TomTom is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Harold C. Goddijn with 12% of shares outstanding. Corinne Goddijn-Vigreux is the second largest shareholder owning 12% of common stock, and Peter-Frans Pauwels holds about 11% of the company stock. Interestingly, the second-largest shareholder, Corinne Goddijn-Vigreux is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.
To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.
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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of TomTom
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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
It seems that insiders own more than half the TomTom N.V. stock. This gives them a lot of power. That means insiders have a very meaningful €497m stake in this €964m business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.
General Public Ownership
With a 27% ownership, the general public, mostly comprising of individual investors, have some degree of sway over TomTom. 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.
It's always worth thinking about the different groups who own shares in a company. But to understand TomTom better, we need to consider many other factors. For example, we've discovered 1 warning sign for TomTom that you should be aware of before investing here.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.
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.
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