Individual investors are Round One Corporation's (TSE:4680) biggest owners and were hit after market cap dropped JP¥60b

Key Insights

• Significant control over Round One by individual investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 9 shareholders
• Insider ownership in Round One is 36%

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Every investor in Round One Corporation (TSE:4680) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 40% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 23% decrease in the stock price last week, individual investors suffered the most losses, but insiders who own 36% stock also took a hit.

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

View our latest analysis for Round One

What Does The Institutional Ownership Tell Us About Round One?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Round One 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. 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 Round One's historic earnings and revenue below, but keep in mind there's always more to the story.

Round One is not owned by hedge funds. Kimihiko Sugino is currently the largest shareholder, with 36% of shares outstanding. The second and third largest shareholders are Norges Bank Investment Management and Nomura Asset Management Co., Ltd., with an equal amount of shares to their name at 2.9%.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Round One

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

It seems insiders own a significant proportion of Round One Corporation. It has a market capitalization of just JP¥202b, and insiders have JP¥72b worth of shares in their own names. That's quite significant. 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

With a 40% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Round One. 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 Round One better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Round One you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts .

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.