Rorze Corporation's (TSE:6323) largest shareholder, Other Professional Fumio Sakiya sees holdings value fall by 7.6% following recent drop

Key Insights

• Significant insider control over Rorze implies vested interests in company growth
• 51% of the business is held by the top 2 shareholders
• Institutions own 33% of Rorze

To get a sense of who is truly in control of Rorze Corporation (TSE:6323), it is important to understand the ownership structure of the business. With 40% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 7.6% decline in share price, insiders suffered the most losses.

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

Check out our latest analysis for Rorze

What Does The Institutional Ownership Tell Us About Rorze?

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 Rorze does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Rorze, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Rorze. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Rorze's case, its Other Professional, Fumio Sakiya, is the largest shareholder, holding 40% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 11% and 4.1%, of the shares outstanding, respectively.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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 Rorze

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. 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.

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.

It seems insiders own a significant proportion of Rorze Corporation. It is very interesting to see that insiders have a meaningful JP¥150b stake in this JP¥370b business. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 27% stake in Rorze. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Rorze better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Rorze you should know about.

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.