The big shareholder groups in CENTRAL MOTEK Co.Ltd. (KRX:308170) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.
CENTRAL MOTEKLtd is not a large company by global standards. It has a market capitalization of ₩257b, which means it wouldn't have the attention of many institutional investors. In the chart below, we can see that institutions don't own shares in the company. Let's take a closer look to see what the different types of shareholders can tell us about CENTRAL MOTEKLtd.
What Does The Lack Of Institutional Ownership Tell Us About CENTRAL MOTEKLtd?
We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.
There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. Alternatively, there might be something about the company that has kept institutional investors away. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of CENTRAL MOTEKLtd, for yourself, below.
Hedge funds don't have many shares in CENTRAL MOTEKLtd. Looking at our data, we can see that the largest shareholder is Taeryong Kang with 34% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 15% and 3.7%, of the shares outstanding, respectively.
To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.
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. There is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of CENTRAL MOTEKLtd
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
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 information suggests that insiders own more than half of CENTRAL MOTEK Co.Ltd.. This gives them effective control of the company. So they have a ₩135b stake in this ₩257b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 44% ownership, the general public have some degree of sway over CENTRAL MOTEKLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
It's always worth thinking about the different groups who own shares in a company. But to understand CENTRAL MOTEKLtd better, we need to consider many other factors. For instance, we've identified 4 warning signs for CENTRAL MOTEKLtd (1 is significant) 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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