Key Insights

• Significant control over Calumet Specialty Products Partners by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 46% of the company
• Institutions own 25% of Calumet Specialty Products Partners

A look at the shareholders of Calumet Specialty Products Partners, L.P. (NASDAQ:CLMT) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 50% 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$82m market cap gain, institutions too had a 25% share in those profits.

In the chart below, we zoom in on the different ownership groups of Calumet Specialty Products Partners.

What Does The Institutional Ownership Tell Us About Calumet Specialty Products Partners?

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 Calumet Specialty Products Partners. 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. 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 Calumet Specialty Products Partners' historic earnings and revenue below, but keep in mind there's always more to the story.

It looks like hedge funds own 5.4% of Calumet Specialty Products Partners shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Our data shows that The Heritage Group is the largest shareholder with 14% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.3% and 6.8%, of the shares outstanding, respectively.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 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 Calumet Specialty Products Partners

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. 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.

Our most recent data indicates that insiders own some shares in Calumet Specialty Products Partners, L.P.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around US$42m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 50% of Calumet Specialty Products Partners shares. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

We can see that Private Companies own 16%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Calumet Specialty Products Partners better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Calumet Specialty Products Partners (including 2 which don't sit too well with us) .

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.

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.