Here's What Xos, Inc.'s (NASDAQ:XOS) Shareholder Ownership Structure Looks Like




  • In Business
  • 2022-05-11 17:22:17Z
  • By Simply Wall St.
 

A look at the shareholders of Xos, Inc. (NASDAQ:XOS) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

With a market capitalization of US$369m, Xos is a small cap stock, so it might not be well known by many institutional investors. In the chart below, we can see that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholders can tell us about Xos.

View our latest analysis for Xos

What Does The Institutional Ownership Tell Us About Xos?

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 Xos. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Xos' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Xos. With a 35% stake, CEO Dakota Semler is the largest shareholder. Meanwhile, the second and third largest shareholders, hold 14% and 12%, of the shares outstanding, respectively. Interestingly, the second-largest shareholder, Giordano Sordoni is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Xos

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 most recent data indicates that insiders own the majority of Xos, Inc.. This means they can collectively make decisions for the company. Given it has a market cap of US$369m, that means they have US$194m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 27% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 12%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Xos (at least 1 which is a bit unpleasant) , and understanding them should be part of your investment process.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.

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.

COMMENTS

More Related News

Is IperionX (ASX:IPX) In A Good Position To Deliver On Growth Plans?
Is IperionX (ASX:IPX) In A Good Position To Deliver On Growth Plans?

We can readily understand why investors are attracted to unprofitable companies. For example, although Amazon.com made...

What Kind Of Investors Own Most Of ALS Limited (ASX:ALQ)?
What Kind Of Investors Own Most Of ALS Limited (ASX:ALQ)?

Every investor in ALS Limited ( ASX:ALQ ) should be aware of the most powerful shareholder groups. Insiders often own a...

What You Need To Know About Healthia Limited
What You Need To Know About Healthia Limited's (ASX:HLA) Investor Composition

Every investor in Healthia Limited ( ASX:HLA ) should be aware of the most powerful shareholder groups. Institutions...

Is Temple & Webster Group Ltd (ASX:TPW) Popular Amongst Insiders?
Is Temple & Webster Group Ltd (ASX:TPW) Popular Amongst Insiders?

The big shareholder groups in Temple & Webster Group Ltd ( ASX:TPW ) have power over the company. Institutions will...

Trade Alert: The Executive Chairman Of Evolution Mining Limited (ASX:EVN), Jacob Klein, Has Just Spent AU$135k Buying A Few More Shares
Trade Alert: The Executive Chairman Of Evolution Mining Limited (ASX:EVN), Jacob Klein, Has Just Spent AU$135k Buying A Few More Shares

Whilst it may not be a huge deal, we thought it was good to see that the Evolution Mining Limited ( ASX:EVN ) Executive...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

  • techyhigher
    (2022-05-12 04:46:44Z)

    I think this is an informative post and it is very beneficial and knowledgeable. Therefore, I would like to thank you for the endeavors that you have made in writing this article. All the content is absolutely well-researched. Thanks…
    coin master free spin links

    REPLY
  • mosttechs
    (2022-05-28 07:08:55Z)

    Great write-up, I am a big believer in commenting on blogs to inform the blog writers know that they’ve added something worthwhile to the world wide web!..

    REPLY
  • freespinlinks
    (2022-06-12 11:01:23Z)

    Great Article help full information provide

    REPLY

Top News: Business