BHI Co., Ltd.'s (KOSDAQ:083650) 33% gain last week benefited both individual investors who own 46% as well as insiders

Key Insights

• BHI's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 50% of the business is held by the top 7 shareholders
• 40% of BHI is held by insiders

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If you want to know who really controls BHI Co., Ltd. (KOSDAQ:083650), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 46% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While individual investors were the group that benefitted the most from last week’s ₩453b market cap gain, insiders too had a 40% share in those profits.

In the chart below, we zoom in on the different ownership groups of BHI.

View our latest analysis for BHI

What Does The Institutional Ownership Tell Us About BHI?

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.

As you can see, institutional investors have a fair amount of stake in BHI. 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 BHI's historic earnings and revenue below, but keep in mind there's always more to the story.

BHI is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Eun-Mi Park with 17% of shares outstanding. For context, the second largest shareholder holds about 16% of the shares outstanding, followed by an ownership of 4.7% by the third-largest shareholder. Jong-Inn Woo, who is the second-largest shareholder, also happens to hold the title of Co-Chief Executive Officer.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of BHI

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.

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 most recent data indicates that insiders own a reasonable proportion of BHI Co., Ltd.. It has a market capitalization of just ₩1.8t, and insiders have ₩740b worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 46% stake in BHI. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand BHI better, we need to consider many other factors. For example, we've discovered 1 warning sign for BHI 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.