Insiders are the top stockholders in Noritsu Koki Co., Ltd. (TSE:7744), and the recent 4.5% drop might have disappointed them

Key Insights

• Insiders appear to have a vested interest in Noritsu Koki's growth, as seen by their sizeable ownership
• 51% of the business is held by the top 2 shareholders
• Institutions own 19% of Noritsu Koki

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A look at the shareholders of Noritsu Koki Co., Ltd. (TSE:7744) can tell us which group is most powerful. The group holding the most number of shares in the company, around 49% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders as a group endured the highest losses after market cap fell by JP¥8.4b.

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

Check out our latest analysis for Noritsu Koki

What Does The Institutional Ownership Tell Us About Noritsu Koki?

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 Noritsu Koki does have institutional investors; and they hold a good portion of the company's stock. 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 Noritsu Koki's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Noritsu Koki. Kayo Nishimoto is currently the company's largest shareholder with 49% of shares outstanding. Norges Bank Investment Management is the second largest shareholder owning 2.4% of common stock, and Baillie Gifford & Co. holds about 2.1% of the company stock.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

It seems insiders own a significant proportion of Noritsu Koki Co., Ltd.. It is very interesting to see that insiders have a meaningful JP¥88b stake in this JP¥179b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. 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 31% stake in 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Noritsu Koki better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Noritsu Koki you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.