SAKURA Internet Inc.'s (TSE:3778) stock price dropped 6.5% last week; individual investors would not be happy

Key Insights

• Significant control over SAKURA Internet by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 7 shareholders own 51% of the company
• Insider ownership in SAKURA Internet is 18%

If you want to know who really controls SAKURA Internet Inc. (TSE:3778), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 44% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors as a group endured the highest losses last week after market cap fell by JP¥13b.

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

View our latest analysis for SAKURA Internet

What Does The Institutional Ownership Tell Us About SAKURA Internet?

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.

As you can see, institutional investors have a fair amount of stake in SAKURA Internet. 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. 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 SAKURA Internet's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in SAKURA Internet. The company's largest shareholder is Sojitz Corporation, with ownership of 26%. In comparison, the second and third largest shareholders hold about 14% and 2.7% of the stock. Kunihiro Tanaka, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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 SAKURA Internet

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. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 information suggests that insiders maintain a significant holding in SAKURA Internet Inc.. It has a market capitalization of just JP¥184b, and insiders have JP¥33b worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 44% stake in SAKURA Internet. 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

Public companies currently own 26% of SAKURA Internet stock. 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:

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 example, we've discovered 3 warning signs for SAKURA Internet (2 are 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.