Toei Animation Co.,Ltd.'s (TSE:4816) market cap surged JP¥20b last week, public companies who have a lot riding on the company were rewarded

Key Insights

• Significant control over Toei AnimationLtd by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 61% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

Every investor in Toei Animation Co.,Ltd. (TSE:4816) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 74% to be precise, is public companies. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, public companies were the biggest beneficiaries of last week’s 3.3% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Toei AnimationLtd.

View our latest analysis for Toei AnimationLtd

What Does The Institutional Ownership Tell Us About Toei AnimationLtd?

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.

Toei AnimationLtd 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 Toei AnimationLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Toei AnimationLtd. The company's largest shareholder is Toei Company, Ltd., with ownership of 40%. With 20% and 8.4% of the shares outstanding respectively, TV Asahi Holdings Corporation and Fuji Media Holdings, Inc. are the second and third largest shareholders.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 Toei AnimationLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 information suggests that Toei Animation Co.,Ltd. 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¥449m 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

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Toei AnimationLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

It appears to us that public companies own 74% of Toei AnimationLtd. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Toei AnimationLtd better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.