Retail investors who have a significant stake must be disappointed along with institutions after GS Engineering & Construction Corporation's (KRX:006360) market cap dropped by ₩191b

Key Insights

• GS Engineering & Construction's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 51% of the business is held by the top 11 shareholders
• Insiders own 22% of GS Engineering & Construction

To get a sense of who is truly in control of GS Engineering & Construction Corporation (KRX:006360), it is important to understand the ownership structure of the business. With 43% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 11% decrease in the stock price last week, retail investors suffered the most losses, but institutions who own 32% stock also took a hit.

Let's take a closer look to see what the different types of shareholders can tell us about GS Engineering & Construction.

See our latest analysis for GS Engineering & Construction

What Does The Institutional Ownership Tell Us About GS Engineering & Construction?

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.

GS Engineering & Construction already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 GS Engineering & Construction's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in GS Engineering & Construction. Chang-Soo Huh is currently the company's largest shareholder with 10% of shares outstanding. For context, the second largest shareholder holds about 9.6% of the shares outstanding, followed by an ownership of 5.4% by the third-largest shareholder.

Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 11 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 GS Engineering & Construction

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 GS Engineering & Construction Corporation. It is very interesting to see that insiders have a meaningful ₩347b stake in this ₩1.5t business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 43% ownership, the general public, mostly comprising of individual investors, have some degree of sway over GS Engineering & Construction. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 2 warning signs we've spotted with GS Engineering & Construction .

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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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.