Public companies in Toyoda Gosei Co., Ltd. (TSE:7282) are its biggest bettors, and their bets paid off as stock gained 3.7% last week

Key Insights

• The considerable ownership by public companies in Toyoda Gosei indicates that they collectively have a greater say in management and business strategy
• A total of 3 investors have a majority stake in the company with 51% ownership
• 27% of Toyoda Gosei is held by Institutions

To get a sense of who is truly in control of Toyoda Gosei Co., Ltd. (TSE:7282), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are public companies with 44% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, public companies were the biggest beneficiaries of last week’s 3.7% gain.

In the chart below, we zoom in on the different ownership groups of Toyoda Gosei.

Check out our latest analysis for Toyoda Gosei

What Does The Institutional Ownership Tell Us About Toyoda Gosei?

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 Toyoda Gosei. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Toyoda Gosei's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Toyoda Gosei. Looking at our data, we can see that the largest shareholder is Toyota Motor Corporation with 44% of shares outstanding. Nikko Asset Management Co., Ltd. is the second largest shareholder owning 4.6% of common stock, and Sumitomo Mitsui Financial Group Inc., Asset Management Arm holds about 3.3% of the company stock.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Toyoda Gosei

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

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 information suggests that Toyoda Gosei Co., Ltd. insiders own under 1% of the company. Keep in mind that it's a big company, and the insiders own JP¥197m worth of shares. The absolute value might be more important than the proportional share. 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-- including retail investors -- own 27% stake in the company, and hence can't easily be ignored. 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

Public companies currently own 44% of Toyoda Gosei stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Toyoda Gosei better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Toyoda Gosei you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.