Public companies among LS ELECTRIC Co., Ltd.'s (KRX:010120) largest shareholders, saw gain in holdings value after stock jumped 18% last week

Key Insights

• Significant control over LS ELECTRIC by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 61% of the company
• Institutions own 25% of LS ELECTRIC

Every investor in LS ELECTRIC Co., Ltd. (KRX:010120) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are public companies with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies were the biggest beneficiaries of last week’s 18% gain.

Let's take a closer look to see what the different types of shareholders can tell us about LS ELECTRIC.

Check out our latest analysis for LS ELECTRIC

What Does The Institutional Ownership Tell Us About LS ELECTRIC?

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.

LS ELECTRIC already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 LS ELECTRIC's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in LS ELECTRIC. Looking at our data, we can see that the largest shareholder is LS Corp. with 49% of shares outstanding. For context, the second largest shareholder holds about 12% of the shares outstanding, followed by an ownership of 1.8% by the third-largest shareholder.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. 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 LS ELECTRIC

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own less than 1% of LS ELECTRIC Co., Ltd.. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own ₩1.8m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 27% stake in LS ELECTRIC. 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.

Public Company Ownership

We can see that public companies hold 49% of the LS ELECTRIC shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand LS ELECTRIC better, we need to consider many other factors. For instance, we've identified 2 warning signs for LS ELECTRIC that you should be aware of.

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.

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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.