With 56% ownership in Mitsubishi Gas Chemical Company, Inc. (TSE:4182), institutional investors have a lot riding on the business

Key Insights

• Significantly high institutional ownership implies Mitsubishi Gas Chemical Company's stock price is sensitive to their trading actions
• 50% of the business is held by the top 23 shareholders
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Mitsubishi Gas Chemical Company, Inc. (TSE:4182) can tell us which group is most powerful. With 56% stake, institutions possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And last week, institutional investors ended up benefitting the most after the company hit JP¥552b in market cap. The one-year return on investment is currently 38% and last week's gain would have been more than welcomed.

Let's take a closer look to see what the different types of shareholders can tell us about Mitsubishi Gas Chemical Company.

View our latest analysis for Mitsubishi Gas Chemical Company

What Does The Institutional Ownership Tell Us About Mitsubishi Gas Chemical Company?

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.

As you can see, institutional investors have a fair amount of stake in Mitsubishi Gas Chemical 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. 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 Mitsubishi Gas Chemical Company's earnings history below. Of course, the future is what really matters.

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Hedge funds don't have many shares in Mitsubishi Gas Chemical Company. Nomura Asset Management Co., Ltd. is currently the largest shareholder, with 5.6% of shares outstanding. With 4.7% and 4.4% of the shares outstanding respectively, Asset Management One Co., Ltd. and Meiji Yasuda Life Insurance Company, Asset Management Arm are the second and third largest shareholders.

A closer look at our ownership figures suggests that the top 23 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Mitsubishi Gas Chemical Company

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

Our information suggests that Mitsubishi Gas Chemical Company, Inc. insiders own under 1% of the company. 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¥127m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 43% stake in Mitsubishi Gas Chemical Company. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Mitsubishi Gas Chemical Company you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.