Coeur Mining, Inc.'s (NYSE:CDE) latest 6.9% decline adds to one-year losses, institutional investors may consider drastic measures
Key Insights
Institutions' substantial holdings in Coeur Mining implies that they have significant influence over the company's share price
A total of 14 investors have a majority stake in the company with 50% ownership
A look at the shareholders of Coeur Mining, Inc. (NYSE:CDE) can tell us which group is most powerful. We can see that institutions own the lion's share in the company with 69% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
And so it follows that institutional investors was the group most impacted after the company's market cap fell to US$996m last week after a 6.9% drop in the share price. The recent loss, which adds to a one-year loss of 26% for stockholders, may not sit well with this group of investors. Often called “market makers”, institutions wield significant power in influencing the price dynamics of any stock. As a result, if the downtrend continues, institutions may face pressures to sell Coeur Mining, which might have negative implications on individual investors.
In the chart below, we zoom in on the different ownership groups of Coeur Mining.
See our latest analysis for Coeur Mining
What Does The Institutional Ownership Tell Us About Coeur Mining?
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 Coeur Mining 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. 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 Coeur Mining, (below). Of course, keep in mind that there are other factors to consider, too.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Coeur Mining is not owned by hedge funds. Our data shows that Van Eck Associates Corporation is the largest shareholder with 8.9% of shares outstanding. The Vanguard Group, Inc. is the second largest shareholder owning 8.3% of common stock, and BlackRock, Inc. holds about 8.1% of the company stock. In addition, we found that Mitchell Krebs, the CEO has 0.6% of the shares allocated to their name.
Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 14 shareholders, meaning that no single shareholder has a majority interest in the ownership.
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 is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of Coeur Mining
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.
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.
We can see that insiders own shares in Coeur Mining, Inc.. It has a market capitalization of just US$996m, and insiders have US$17m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.
General Public Ownership
With a 29% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Coeur Mining. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Coeur Mining (of which 1 doesn't sit too well with us!) you should know about.
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.
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