Significant control over SEALSQ by retail investors implies that the general public has more power to influence management and governance-related decisions
Every investor in SEALSQ Corp (NASDAQ:LAES) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 58% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
While retail investors were the group that benefitted the most from last week’s US$75m market cap gain, institutions too had a 22% share in those profits.
Let’s delve deeper into each type of owner of SEALSQ, beginning with the chart below.
NasdaqCM:LAES Ownership Breakdown December 25th 2024
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
As you can see, institutional investors have a fair amount of stake in SEALSQ. 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 SEALSQ, (below). Of course, keep in mind that there are other factors to consider, too.
NasdaqCM:LAES Earnings and Revenue Growth December 25th 2024
We note that hedge funds don’t have a meaningful investment in SEALSQ. Our data shows that L1 Capital Pty. Limited is the largest shareholder with 22% of shares outstanding. With 20% and 0.3% of the shares outstanding respectively, WISeKey International Holding AG and Carlos Moreira are the second and third largest shareholders. Carlos Moreira, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.
Our studies suggest that the top 13 shareholders collectively control less than half of the company’s shares, meaning that the company’s shares are widely disseminated and there is no dominant shareholder.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 data suggests that insiders own under 1% of SEALSQ Corp in their own names. It has a market capitalization of just US$165m, and the board has only US$525k worth of shares in their own names. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.
The general public, who are usually individual investors, hold a substantial 58% stake in SEALSQ, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
Public companies currently own 20% of SEALSQ stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.
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. Consider for instance, the ever-present spectre of investment risk. We’ve identified 3 warning signs with SEALSQ , and understanding them should be part of your investment process.
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.
