JFE Holdings, Inc.'s (TSE:5411) largest shareholders are individual investors with 56% ownership, institutions own 40%

Key Insights

• Significant control over JFE Holdings by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 25 investors have a majority stake in the company with 41% ownership
• 40% of JFE Holdings is held by Institutions

A look at the shareholders of JFE Holdings, Inc. (TSE:5411) can tell us which group is most powerful. We can see that individual investors own the lion's share in the company with 56% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And institutions on the other hand have a 40% ownership in the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.

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

View our latest analysis for JFE Holdings

What Does The Institutional Ownership Tell Us About JFE Holdings?

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.

JFE Holdings already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 JFE Holdings' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in JFE Holdings. The company's largest shareholder is BlackRock, Inc., with ownership of 6.6%. Nomura Asset Management Co., Ltd. is the second largest shareholder owning 4.7% of common stock, and The Vanguard Group, Inc. holds about 3.6% of the company stock.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 JFE Holdings

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.

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 JFE Holdings, Inc.. 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¥537m worth of shares. Arguably, recent buying and selling is just as important to consider. 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 56% of JFE Holdings 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand JFE Holdings better, we need to consider many other factors. To that end, you should be aware of the 3 warning signs we've spotted with JFE Holdings .

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.