Ecopro Co., Ltd.'s (KOSDAQ:086520) market cap dropped ₩1.1t last week; Retail investors bore the brunt

Key Insights

• The considerable ownership by retail investors in Ecopro indicates that they collectively have a greater say in management and business strategy
• 41% of the business is held by the top 25 shareholders
• Insiders own 21% of Ecopro

To get a sense of who is truly in control of Ecopro Co., Ltd. (KOSDAQ:086520), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are retail investors with 58% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 12% decrease in the stock price last week, retail investors suffered the most losses, but insiders who own 21% stock also took a hit.

Let's delve deeper into each type of owner of Ecopro, beginning with the chart below.

See our latest analysis for Ecopro

What Does The Institutional Ownership Tell Us About Ecopro?

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 Ecopro. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Ecopro, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Ecopro. Looking at our data, we can see that the largest shareholder is the CEO Dong-Che Lee with 21% of shares outstanding. The second and third largest shareholders are SamChang Co., Ltd. and Daisy Partners Co.,Ltd., with an equal amount of shares to their name at 4.9%.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Ecopro

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 most recent data indicates that insiders own a reasonable proportion of Ecopro Co., Ltd.. Insiders own ₩1.8t worth of shares in the ₩8.4t company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 58% of Ecopro shares. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

Our data indicates that Private Companies hold 9.7%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Ecopro is showing 1 warning sign in our investment analysis , you should know about...

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.