Key Insights

• The considerable ownership by retail investors in QuantumScape indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 49% of the company
• Insiders have been selling lately

Every investor in QuantumScape Corporation (NYSE:QS) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 45% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 16% increase in the stock price last week, retail investors profited the most, but institutions who own 29% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of QuantumScape, beginning with the chart below.

See our latest analysis for QuantumScape

What Does The Institutional Ownership Tell Us About QuantumScape?

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 QuantumScape. 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 QuantumScape, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in QuantumScape. Our data shows that Porsche Automobil Holding SE is the largest shareholder with 17% of shares outstanding. The Vanguard Group, Inc. is the second largest shareholder owning 6.1% of common stock, and Jagdeep Singh holds about 3.9% of the company stock. Jagdeep Singh, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

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.

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.

Insider Ownership Of QuantumScape

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

We can report that insiders do own shares in QuantumScape Corporation. The insiders have a meaningful stake worth US$268m. Most would see this as a real positive. Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over QuantumScape. 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.

Public Company Ownership

We can see that public companies hold 17% of the QuantumScape shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 4 warning signs for QuantumScape (1 shouldn't be ignored!) that you should be aware of before investing here.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.