Institutions along with retail investors who hold considerable shares inThe Tochigi Bank, Ltd. (TSE:8550) come under pressure; lose 11% of holdings value

Key Insights

• The considerable ownership by retail investors in Tochigi Bank indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 43% of the company
• Institutions own 32% of Tochigi Bank

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A look at the shareholders of The Tochigi Bank, Ltd. (TSE:8550) can tell us which group is most powerful. The group holding the most number of shares in the company, around 57% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions, who own 32% shares weren’t spared from last week’s JP¥3.7b market cap drop, retail investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of Tochigi Bank.

Check out our latest analysis for Tochigi Bank

What Does The Institutional Ownership Tell Us About Tochigi Bank?

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 Tochigi Bank. 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 Tochigi Bank's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Tochigi Bank. Our data shows that Wellington Management Group LLP is the largest shareholder with 5.9% of shares outstanding. Tochigi Bank Ltd., ESOP is the second largest shareholder owning 4.2% of common stock, and Deposit Insurance Corporation of Japan, Asset Management Arm holds about 4.0% of the company stock.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Tochigi Bank

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

We can see that insiders own shares in The Tochigi Bank, Ltd.. In their own names, insiders own JP¥944m worth of stock in the JP¥31b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public -- including retail investors -- own 57% of Tochigi Bank. 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

Our data indicates that Private Companies hold 3.4%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Tochigi Bank better, we need to consider many other factors. Be aware that Tochigi Bank is showing 1 warning sign in our investment analysis , you should know about...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.