Hokuetsu Corporation's (TSE:3865) biggest owners are individual investors who got richer after stock soared 4.0% last week

Key Insights

• Hokuetsu's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 5 shareholders own 53% of the company
• 22% of Hokuetsu is held by Institutions

A look at the shareholders of Hokuetsu Corporation (TSE:3865) can tell us which group is most powerful. With 26% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors were the biggest beneficiaries of last week’s 4.0% gain.

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

See our latest analysis for Hokuetsu

What Does The Institutional Ownership Tell Us About Hokuetsu?

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.

Hokuetsu already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Hokuetsu, (below). Of course, keep in mind that there are other factors to consider, too.

Our data indicates that hedge funds own 23% of Hokuetsu. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Oasis Management Company Ltd. is currently the company's largest shareholder with 23% of shares outstanding. With 11% and 9.6% of the shares outstanding respectively, Misuga Kaiun Co., Ltd. and Daio Kaiun Co.,Ltd. are the second and third largest shareholders.

Our research also brought to light the fact that roughly 53% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Hokuetsu

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 data suggests that insiders own under 1% of Hokuetsu Corporation in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. 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¥592m 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 26% stake in Hokuetsu. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 21%, of the shares on issue. 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 3.6% of the Hokuetsu shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hokuetsu better, we need to consider many other factors. For instance, we've identified 1 warning sign for Hokuetsu that you should be aware of.

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.