Taeyoung Engineering & Construction Co.,Ltd.'s (KRX:009410) last week's 19% decline must have disappointed public companies who have a significant stake

Key Insights

• The considerable ownership by public companies in Taeyoung Engineering & ConstructionLtd indicates that they collectively have a greater say in management and business strategy
• TY Holdings Co., Ltd owns 59% of the company
• 12% of Taeyoung Engineering & ConstructionLtd is held by Institutions

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A look at the shareholders of Taeyoung Engineering & Construction Co.,Ltd. (KRX:009410) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are public companies with 59% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And last week, public companies endured the biggest losses as the stock fell by 19%.

In the chart below, we zoom in on the different ownership groups of Taeyoung Engineering & ConstructionLtd.

See our latest analysis for Taeyoung Engineering & ConstructionLtd

What Does The Institutional Ownership Tell Us About Taeyoung Engineering & ConstructionLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Taeyoung Engineering & ConstructionLtd does have institutional investors; and they hold a good portion of the company's stock. 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 Taeyoung Engineering & ConstructionLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Taeyoung Engineering & ConstructionLtd is not owned by hedge funds. TY Holdings Co., Ltd is currently the company's largest shareholder with 59% of shares outstanding. This implies that they have majority interest control of the future of the company. In comparison, the second and third largest shareholders hold about 12% and 0.7% of the stock.

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. 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 Taeyoung Engineering & ConstructionLtd

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.

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 less than 1% of Taeyoung Engineering & Construction Co.,Ltd.. It appears that the board holds about ₩4.5b worth of stock. This compares to a market capitalization of ₩663b. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a 28% stake in Taeyoung Engineering & ConstructionLtd. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

It appears to us that public companies own 59% of Taeyoung Engineering & ConstructionLtd. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 3 warning signs for Taeyoung Engineering & ConstructionLtd (1 shouldn't be ignored!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.