individual investors who own 35% along with institutions invested in Optorun Co.,Ltd. (TSE:6235) saw increase in their holdings value last week

Key Insights

• OptorunLtd's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 11 investors have a majority stake in the company with 52% ownership
• 12% of OptorunLtd is held by insiders

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To get a sense of who is truly in control of Optorun Co.,Ltd. (TSE:6235), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 35% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While individual investors were the group that reaped the most benefits after last week’s 12% price gain, institutions also received a 32% cut.

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

See our latest analysis for OptorunLtd

What Does The Institutional Ownership Tell Us About OptorunLtd?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that OptorunLtd 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. 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 OptorunLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in OptorunLtd. Zhejiang Crystal-Optech Co., Ltd is currently the company's largest shareholder with 16% of shares outstanding. Wellington Management Group LLP is the second largest shareholder owning 7.7% of common stock, and Dae Woong Son holds about 6.4% of the company stock. Additionally, the company's CEO Fan Bin directly holds 1.6% of the total shares outstanding.

After doing some more digging, we found that the top 11 have the combined ownership of 52% in the company, suggesting that no single shareholder has significant control over 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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of OptorunLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 insiders maintain a significant holding in Optorun Co.,Ltd.. Insiders have a JP¥9.1b stake in this JP¥74b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 35% 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.

Public Company Ownership

We can see that public companies hold 19% of the OptorunLtd shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand OptorunLtd better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with OptorunLtd , and understanding them should be part of your investment process.

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.