Japan Eyewear Holdings Co., Ltd.'s (TSE:5889) largest shareholder, CEO Kaneko Shinya sees holdings value fall by 14% following recent drop

Key Insights

• Insiders appear to have a vested interest in Japan Eyewear Holdings' growth, as seen by their sizeable ownership
• A total of 2 investors have a majority stake in the company with 70% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Japan Eyewear Holdings Co., Ltd. (TSE:5889) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 38% ownership. 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, insiders endured the biggest losses as the stock fell by 14%.

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

See our latest analysis for Japan Eyewear Holdings

What Does The Institutional Ownership Tell Us About Japan Eyewear 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.

Japan Eyewear Holdings 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. 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 Japan Eyewear Holdings' historic earnings and revenue below, but keep in mind there's always more to the story.

Japan Eyewear Holdings is not owned by hedge funds. With a 38% stake, CEO Kaneko Shinya is the largest shareholder. Nippon Investment Company is the second largest shareholder owning 32% of common stock, and Polar Capital Holdings Plc holds about 2.1% of the company stock.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Japan Eyewear Holdings

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 a reasonable proportion of Japan Eyewear Holdings Co., Ltd.. Insiders own JP¥29b worth of shares in the JP¥75b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 22% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Japan Eyewear Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With a stake of 32%, private equity firms could influence the Japan Eyewear Holdings board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Japan Eyewear Holdings better, we need to consider many other factors. For example, we've discovered 2 warning signs for Japan Eyewear Holdings (1 is a bit concerning!) that you should be aware of before investing here.

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.