A great week that adds to MEITEC Group Holdings Inc.'s (TSE:9744) one-year returns, institutional investors who own 50% must be happy

Key Insights

• Given the large stake in the stock by institutions, MEITEC Group Holdings' stock price might be vulnerable to their trading decisions
• 48% of the business is held by the top 25 shareholders
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

Every investor in MEITEC Group Holdings Inc. (TSE:9744) should be aware of the most powerful shareholder groups. We can see that institutions own the lion's share in the company with 50% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And things are looking up for institutional investors after the company gained JP¥11b in market cap last week. The one-year return on investment is currently 2.5% and last week's gain would have been more than welcomed.

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

See our latest analysis for MEITEC Group Holdings

What Does The Institutional Ownership Tell Us About MEITEC Group Holdings?

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.

We can see that MEITEC Group 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 MEITEC Group Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in MEITEC Group Holdings. Meiji Yasuda Life Insurance Company, Asset Management Arm is currently the largest shareholder, with 6.1% of shares outstanding. The second and third largest shareholders are Nissay Asset Management Corporation and Goodhart Partners LLP, with an equal amount of shares to their name at 4.3%.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of MEITEC Group Holdings

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. 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 most recent data indicates that insiders own less than 1% of MEITEC Group Holdings Inc.. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own JP¥283m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a 47% stake in MEITEC Group Holdings. 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 1 warning sign for MEITEC Group Holdings 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.