Both public companies who control a good portion of LS ELECTRIC Co., Ltd. (KRX:010120) along with institutions must be dismayed after last week's 7.5% decrease

Key Insights

• Significant control over LS ELECTRIC by public companies implies that the general public has more power to influence management and governance-related decisions
• A total of 2 investors have a majority stake in the company with 59% ownership
• Institutional ownership in LS ELECTRIC is 29%

A look at the shareholders of LS ELECTRIC Co., Ltd. (KRX:010120) can tell us which group is most powerful. We can see that public companies own the lion's share in the company with 49% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While the holdings of public companies took a hit after last week’s 7.5% price drop, institutions with their 29% holdings also suffered.

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

View our latest analysis for LS ELECTRIC

What Does The Institutional Ownership Tell Us About LS ELECTRIC?

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 LS ELECTRIC 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 LS ELECTRIC's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in LS ELECTRIC. Looking at our data, we can see that the largest shareholder is LS Corp. with 49% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 6.2%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 LS ELECTRIC

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.

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.

We note our data does not show any board members holding shares, personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.

General Public Ownership

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. 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.

Public Company Ownership

We can see that public companies hold 49% of the LS ELECTRIC shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand LS ELECTRIC better, we need to consider many other factors. For example, we've discovered 1 warning sign for LS ELECTRIC that you should be aware of before investing here.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.