Do institutions own shares of Mercury Ecommerce Acquisition Corp. (NASDAQ:MEAC)?

If you want to know who actually controls Mercury Ecommerce Acquisition Corp. (NASDAQ:MEAC), you will then need to examine the composition of its share register. Institutions often own shares in larger companies, and we expect to see insiders owning a noticeable percentage of smaller ones. Companies that have been privatized tend to have low insider ownership.

Mercury Ecommerce Acquisition is not a big company by global standards. It has a market cap of US$225 million, which means it wouldn’t get the attention of many institutional investors. Looking at our ownership group data (below), it appears that institutional investors have bought the company. Let’s dig deeper into each owner type to learn more about Mercury e-commerce acquisition.

Check out our latest analysis for the acquisition of Mercury Ecommerce

distribution of property

What does institutional ownership tell us about the acquisition of Mercury Ecommerce?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.

We can see that Mercury Ecommerce Acquisition has institutional investors; and they own a good part of the shares of the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Mercury Ecommerce Acquisition’s historical revenue and earnings below, but keep in mind there’s always more to tell.

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Our data shows that hedge funds own 30% of Mercury Ecommerce Acquisition. This catches my attention because hedge funds sometimes try to influence management or make changes that will create short-term shareholder value. Mercury Sponsor Group I LLC is currently the largest shareholder, with 15% of the shares outstanding. The second and third largest shareholders are Farallon Capital Management, LLC and Polar Asset Management Partners Inc., with an equal number of shares to their names at 7.7%.

We dug a little deeper and found that 7 of the major shareholders make up about 53% of the register, implying that along with the large shareholders, there are a few smaller shareholders, thus balancing everyone’s interests somewhat.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. We don’t see any analyst coverage of the stock at this time, so the company is unlikely to be widely held.

Insider Ownership of Mercury Ecommerce Acquisition

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management of the company answers to the board of directors and the latter must represent the interests of the shareholders. In particular, sometimes the senior executives themselves sit on the board of directors.

Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.

Our information suggests that insiders at Mercury Ecommerce Acquisition Corp. hold less than 1% of the company. We note, however, that insiders may have an indirect interest through a private company or other corporate structure. It has a market capitalization of just US$225 million and the board of directors only owns US$1.8 million of stock in its own name. We generally like to see a more invested board. However, it may be useful to check whether these insiders have bought.

General public property

With an 11% stake, the general public, consisting mostly of individual investors, has some influence in the acquisition of Mercury Ecommerce. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.

Private Company Ownership

We can see that private companies hold 15% of the issued shares. It might be worth exploring this further. If related parties, such as insiders, have an interest in any of these private companies, this should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next steps:

While it is worth considering the different groups that own a business, there are other, even more important factors. Like risks, for example. Every business has them, and we’ve spotted 5 Warning Signs for Mercury Ecommerce Acquisition (including 4 a little unpleasant!) to know.

If you’d rather check out another company – one with potentially superior finances – then don’t miss this free list of interesting companies, supported by solid financial data.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month the financial statements are dated. This may not be consistent with the annual report figures for the full year.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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