Institutions profited after Nittetsu Mining Co., Ltd.'s (TSE:1515) market cap rose JP¥8.7b last week but retail investors profited the most

Key Insights

• The considerable ownership by retail investors in Nittetsu Mining indicates that they collectively have a greater say in management and business strategy
• The top 13 shareholders own 51% of the company
• Institutional ownership in Nittetsu Mining is 31%

We've discovered 3 warning signs about Nittetsu Mining. View them for free.

If you want to know who really controls Nittetsu Mining Co., Ltd. (TSE:1515), 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 retail investors with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Retail investors gained the most after market cap touched JP¥107b last week, while institutions who own 31% also benefitted.

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

See our latest analysis for Nittetsu Mining

What Does The Institutional Ownership Tell Us About Nittetsu Mining?

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.

Nittetsu Mining already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Nittetsu Mining, (below). Of course, keep in mind that there are other factors to consider, too.

Nittetsu Mining is not owned by hedge funds. Nippon Steel Corporation is currently the largest shareholder, with 10% of shares outstanding. Nittetsu Kogyo Shogakukai is the second largest shareholder owning 8.1% of common stock, and Continental General Insurance Company, Asset Management Arm holds about 5.3% of the company stock.

After doing some more digging, we found that the top 13 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over the company.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Nittetsu Mining

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Our most recent data indicates that insiders own less than 1% of Nittetsu Mining Co., Ltd.. But they may have an indirect interest through a corporate structure that we haven't picked up on. It appears that the board holds about JP¥227m worth of stock. This compares to a market capitalization of JP¥107b. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

The general public-- including retail investors -- own 43% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

It seems that Private Companies own 15%, of the Nittetsu Mining stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

We can see that public companies hold 10% of the Nittetsu Mining shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Nittetsu Mining has 3 warning signs we think you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.