Retail investors who have a significant stake must be disappointed along with institutions after Namura Shipbuilding Co., Ltd.'s (TSE:7014) market cap dropped by JP¥8.2b

Key Insights

• The considerable ownership by retail investors in Namura Shipbuilding indicates that they collectively have a greater say in management and business strategy
• A total of 19 investors have a majority stake in the company with 51% ownership
• Institutions own 23% of Namura Shipbuilding

A look at the shareholders of Namura Shipbuilding Co., Ltd. (TSE:7014) can tell us which group is most powerful. The group holding the most number of shares in the company, around 55% 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).

Following a 7.6% decrease in the stock price last week, retail investors suffered the most losses, but institutions who own 23% stock also took a hit.

Let's delve deeper into each type of owner of Namura Shipbuilding, beginning with the chart below.

Check out our latest analysis for Namura Shipbuilding

What Does The Institutional Ownership Tell Us About Namura Shipbuilding?

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 Namura Shipbuilding does have institutional investors; and they hold a good portion of the company's stock. 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 Namura Shipbuilding'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 Namura Shipbuilding. Our data shows that Nippon Steel Corporation is the largest shareholder with 7.2% of shares outstanding. With 4.6% and 3.2% of the shares outstanding respectively, Barclays Bank PLC, Securities Investments and MUFG Bank, Ltd.,Investment Banking Arm are the second and third largest shareholders.

Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 19 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Namura Shipbuilding

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 information suggests that Namura Shipbuilding Co., Ltd. insiders own under 1% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It appears that the board holds about JP¥695m worth of stock. This compares to a market capitalization of JP¥100b. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 55% stake in Namura Shipbuilding, suggesting it is a fairly popular stock. 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.

Public Company Ownership

We can see that public companies hold 19% of the Namura Shipbuilding shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For instance, we've identified 2 warning signs for Namura Shipbuilding (1 makes us a bit uncomfortable) that you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.