Public companies in Global Security Experts Inc. (TSE:4417) are its biggest bettors, and their bets paid off as stock gained 13% last week

Key Insights

• Significant control over Global Security Experts by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 60% of the company
• 14% of Global Security Experts is held by Institutions

We've discovered 2 warning signs about Global Security Experts. View them for free.

Every investor in Global Security Experts Inc. (TSE:4417) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 65% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, public companies benefitted the most after the company's market cap rose by JP¥5.6b last week.

In the chart below, we zoom in on the different ownership groups of Global Security Experts.

View our latest analysis for Global Security Experts

What Does The Institutional Ownership Tell Us About Global Security Experts?

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.

Global Security Experts already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Global Security Experts' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Global Security Experts. Business Brain Showa-Ota Inc. is currently the largest shareholder, with 40% of shares outstanding. With 20% and 4.6% of the shares outstanding respectively, Kanematsu Corporation and Asset Management One Co., Ltd. are the second and third largest shareholders. In addition, we found that Shiro Aoyagi, the CEO has 1.7% of the shares allocated to their name.

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 60% stake.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Global Security Experts

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.

We can see that insiders own shares in Global Security Experts Inc.. As individuals, the insiders collectively own JP¥2.5b worth of the JP¥48b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 16% 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

It appears to us that public companies own 65% of Global Security Experts. 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:

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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Global Security Experts , 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.