Positive week for Hamamatsu Photonics K.K. (TSE:6965) institutional investors who lost 7.9% over the past year

Key Insights

• Institutions' substantial holdings in Hamamatsu Photonics K.K implies that they have significant influence over the company's share price
• The top 25 shareholders own 50% of the company
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

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Every investor in Hamamatsu Photonics K.K. (TSE:6965) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

After a year of 7.9% losses, last week’s 8.9% gain would be welcomed by institutional investors as a possible sign that returns might start trending higher.

In the chart below, we zoom in on the different ownership groups of Hamamatsu Photonics K.K.

See our latest analysis for Hamamatsu Photonics K.K

What Does The Institutional Ownership Tell Us About Hamamatsu Photonics K.K?

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 Hamamatsu Photonics K.K 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 Hamamatsu Photonics K.K's historic earnings and revenue below, but keep in mind there's always more to the story.

Hamamatsu Photonics K.K is not owned by hedge funds. Our data shows that T. Rowe Price Group, Inc. is the largest shareholder with 4.9% of shares outstanding. BlackRock, Inc. is the second largest shareholder owning 4.9% of common stock, and Capital Research and Management Company holds about 4.7% of the company stock.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Hamamatsu Photonics K.K

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 most recent data indicates that insiders own less than 1% of Hamamatsu Photonics K.K.. Keep in mind that it's a big company, and the insiders own JP¥282m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 47% 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.

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 instance, we've identified 3 warning signs for Hamamatsu Photonics K.K that you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.