Insiders were the biggest winners as Noritsu Koki Co., Ltd.'s (TSE:7744) market cap grew by JP¥19b last week

Key Insights

• Significant insider control over Noritsu Koki implies vested interests in company growth
• A total of 2 investors have a majority stake in the company with 51% ownership
• Institutional ownership in Noritsu Koki is 25%

If you want to know who really controls Noritsu Koki Co., Ltd. (TSE:7744), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 49% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders scored the highest last week as the company hit JP¥174b market cap following a 12% gain in the stock.

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

View our latest analysis for Noritsu Koki

What Does The Institutional Ownership Tell Us About Noritsu Koki?

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.

Noritsu Koki 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 Noritsu Koki'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 Noritsu Koki. Our data shows that Kayo Nishimoto is the largest shareholder with 49% of shares outstanding. For context, the second largest shareholder holds about 2.5% of the shares outstanding, followed by an ownership of 2.3% by the third-largest shareholder.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Noritsu Koki

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 insiders maintain a significant holding in Noritsu Koki Co., Ltd.. It has a market capitalization of just JP¥174b, and insiders have JP¥85b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Noritsu Koki. 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.

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. Case in point: We've spotted 2 warning signs for Noritsu Koki 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.