While institutions invested in Mitsui Matsushima Holdings Co., Ltd. (TSE:1518) benefited from last week's 10% gain, private companies stood to gain the most

Key Insights

• Significant control over Mitsui Matsushima Holdings by private companies implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 5 shareholders
• Institutional ownership in Mitsui Matsushima Holdings is 38%

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To get a sense of who is truly in control of Mitsui Matsushima Holdings Co., Ltd. (TSE:1518), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 38% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 10% increase in the stock price last week, private companies profited the most, but institutions who own 38% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of Mitsui Matsushima Holdings.

View our latest analysis for Mitsui Matsushima Holdings

What Does The Institutional Ownership Tell Us About Mitsui Matsushima Holdings?

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

We can see that Mitsui Matsushima Holdings does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Mitsui Matsushima Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

Mitsui Matsushima Holdings is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Office Support Co. Ltd. with 28% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.6% and 4.8% of the stock.

On looking further, we found that 52% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Mitsui Matsushima Holdings

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.

We can see that insiders own shares in Mitsui Matsushima Holdings Co., Ltd.. It has a market capitalization of just JP¥46b, and insiders have JP¥2.2b worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Mitsui Matsushima Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 38%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Mitsui Matsushima Holdings better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Mitsui Matsushima Holdings , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.