Individual investors who hold 55% of HS Valve Co., Ltd (KOSDAQ:039610) gained 23%, insiders profited as well

Key Insights

• HS Valve's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 45% of the business is held by the top 5 shareholders
• 26% of HS Valve is held by insiders

Every investor in HS Valve Co., Ltd (KOSDAQ:039610) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 55% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 23% increase in the stock price last week, individual investors profited the most, but insiders who own 26% stock also stood to gain from the increase.

Let's take a closer look to see what the different types of shareholders can tell us about HS Valve.

View our latest analysis for HS Valve

What Does The Institutional Ownership Tell Us About HS Valve?

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 HS Valve does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 HS Valve's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in HS Valve. Our data suggests that Won-Gyu Chang, who is also the company's Co-Chief Executive Officer, holds the most number of shares at 15%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. For context, the second largest shareholder holds about 9.8% of the shares outstanding, followed by an ownership of 8.8% by the third-largest shareholder.

On studying our ownership data, we found that 5 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of HS Valve

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

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 HS Valve Co., Ltd. It has a market capitalization of just ₩136b, and insiders have ₩36b worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. 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 substantial 55% stake in HS Valve, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

Our data indicates that Private Companies hold 9.8%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand HS Valve better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with HS Valve , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.