Kyoritsu Maintenance Co., Ltd.'s (TSE:9616) market cap touched JP¥220b last week, benefiting both retail investors who own 52% as well as institutions

Key Insights

• The considerable ownership by retail investors in Kyoritsu Maintenance indicates that they collectively have a greater say in management and business strategy
• A total of 21 investors have a majority stake in the company with 50% ownership
• Institutions own 36% of Kyoritsu Maintenance

To get a sense of who is truly in control of Kyoritsu Maintenance Co., Ltd. (TSE:9616), it is important to understand the ownership structure of the business. With 52% stake, retail investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that reaped the most benefits after last week’s 3.7% price gain, institutions also received a 36% cut.

In the chart below, we zoom in on the different ownership groups of Kyoritsu Maintenance.

View our latest analysis for Kyoritsu Maintenance

What Does The Institutional Ownership Tell Us About Kyoritsu Maintenance?

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 Kyoritsu Maintenance 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 Kyoritsu Maintenance's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Kyoritsu Maintenance. The company's largest shareholder is Milestone Co., Ltd., with ownership of 11%. For context, the second largest shareholder holds about 5.3% of the shares outstanding, followed by an ownership of 5.2% by the third-largest shareholder.

A closer look at our ownership figures suggests that the top 21 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Kyoritsu Maintenance

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Kyoritsu Maintenance Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own JP¥3.2b worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 52% of Kyoritsu Maintenance shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

We can see that Private Companies own 11%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

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. To that end, you should be aware of the 1 warning sign we've spotted with Kyoritsu Maintenance .

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.