Danieli & C. Officine Meccaniche S.p.A.'s (BIT:DAN) market cap surged €52m last week, individual investors who have a lot riding on the company were rewarded

Stock Analysis

To get a sense of who is truly in control of Danieli & C. Officine Meccaniche S.p.A. (BIT:DAN), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 37% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors collectively scored the highest last week as the company hit €1.5b market cap following a 3.1% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Danieli & C. Officine Meccaniche.

Check out our latest analysis for Danieli & C. Officine Meccaniche

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 Danieli & C. Officine Meccaniche. 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. 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 Danieli & C. Officine Meccaniche's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Danieli & C. Officine Meccaniche. Looking at our data, we can see that the largest shareholder is Sind International S.R.L. with 34% of shares outstanding. Cobas Asset Management, SGIIC, SA is the second largest shareholder owning 3.8% of common stock, and Fideuram Investimenti SGR S.p.A. holds about 2.6% of the company stock.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 note our data does not show any board members holding shares, personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

The general public, who are usually individual investors, hold a 37% stake in Danieli & C. Officine Meccaniche. 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 seems that Private Companies own 34%, of the Danieli & C. Officine Meccaniche stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.

Find out whether Danieli & C. Officine Meccaniche is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.

Danieli & C. Officine Meccaniche S.p.A. designs, builds, and sells plants for the iron and steel industry in Europe, Russia, the Middle East, the Americas, and South East Asia.

Flawless balance sheet with solid track record.