Institutional owners may ignore MITSUI-SOKO HOLDINGS Co., Ltd.'s (TSE:9302) recent JP¥15b market cap decline as longer-term profits stay in the green

Key Insights

• Given the large stake in the stock by institutions, MITSUI-SOKO HOLDINGS' stock price might be vulnerable to their trading decisions
• The top 20 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 MITSUI-SOKO HOLDINGS Co., Ltd. (TSE:9302) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 16% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

No shareholder likes losing money on their investments, especially institutional investors who saw their holdings drop 6.5% in value last week. Still, the 92% one-year gains may have helped mitigate their overall losses. We would assume however, that they would be on the lookout for weakness in the future.

In the chart below, we zoom in on the different ownership groups of MITSUI-SOKO HOLDINGS.

See our latest analysis for MITSUI-SOKO HOLDINGS

What Does The Institutional Ownership Tell Us About MITSUI-SOKO HOLDINGS?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that MITSUI-SOKO HOLDINGS does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 MITSUI-SOKO HOLDINGS' earnings history below. Of course, the future is what really matters.

MITSUI-SOKO HOLDINGS is not owned by hedge funds. Our data shows that Taiju Life Insurance Company Limited, Asset Management Arm is the largest shareholder with 6.3% of shares outstanding. MS&AD Insurance Group Holdings, Inc., Asset Management Arm is the second largest shareholder owning 5.6% of common stock, and Sumitomo Mitsui Trust Asset Management Co., Ltd. holds about 4.9% of the company stock.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 20 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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 MITSUI-SOKO HOLDINGS

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our data suggests that insiders own under 1% of MITSUI-SOKO HOLDINGS Co., Ltd. in their own names. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own JP¥144m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over MITSUI-SOKO HOLDINGS. 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 MITSUI-SOKO HOLDINGS better, we need to consider many other factors. For example, we've discovered 1 warning sign for MITSUI-SOKO HOLDINGS 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.