Dear Life Co.,Ltd. (TSE:3245) surges 15%; retail investors who own 49% shares profited along with insiders

Key Insights

• Dear LifeLtd's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 16 investors have a majority stake in the company with 50% ownership
• Insiders own 41% of Dear LifeLtd

To get a sense of who is truly in control of Dear Life Co.,Ltd. (TSE:3245), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 49% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While retail investors were the group that reaped the most benefits after last week’s 15% price gain, insiders also received a 41% cut.

In the chart below, we zoom in on the different ownership groups of Dear LifeLtd.

Check out our latest analysis for Dear LifeLtd

What Does The Institutional Ownership Tell Us About Dear LifeLtd?

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.

We can see that Dear LifeLtd does have institutional investors; and they hold a good portion of the company's stock. 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 Dear LifeLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Dear LifeLtd. With a 38% stake, CEO Yukihiro Abe is the largest shareholder. With 2.3% and 1.3% of the shares outstanding respectively, Nomura Asset Management Co., Ltd. and Dimensional Fund Advisors LP are the second and third largest shareholders.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 16 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Dear LifeLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Dear Life Co.,Ltd.. Insiders own JP¥16b worth of shares in the JP¥38b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 49% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For instance, we've identified 1 warning sign for Dear LifeLtd that you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.