Public companies who hold 52% of Paltac Corporation (TSE:8283) gained 5.1%, institutions profited as well

Key Insights

• The considerable ownership by public companies in Paltac indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is MediPal Holdings Corporation with a 52% stake
• Institutions own 24% of Paltac

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A look at the shareholders of Paltac Corporation (TSE:8283) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are public companies with 52% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While public companies were the group that benefitted the most from last week’s JP¥12b market cap gain, institutions too had a 24% share in those profits.

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

Check out our latest analysis for Paltac

What Does The Institutional Ownership Tell Us About Paltac?

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.

We can see that Paltac does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Paltac, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Paltac. Our data shows that MediPal Holdings Corporation is the largest shareholder with 52% of shares outstanding. This implies that they have majority interest control of the future of the company. FMR LLC is the second largest shareholder owning 7.7% of common stock, and Paltac Corporation Employees' Stock Ownership Association holds about 2.0% of the company stock.

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 Paltac

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 most recent data indicates that insiders own less than 1% of Paltac Corporation. Keep in mind that it's a big company, and the insiders own JP¥407m worth of shares. The absolute value might be more important than the proportional share. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

We can see that public companies hold 52% of the Paltac shares on issue. 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 Paltac better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.