KEPCO Engineering & Construction Company, Inc.'s (KRX:052690) last week's 4.0% decline must have disappointed public companies who have a significant stake

Key Insights

• The considerable ownership by public companies in KEPCO Engineering & Construction Company indicates that they collectively have a greater say in management and business strategy
• Korea Electric Power Corporation owns 51% of the company
• Institutional ownership in KEPCO Engineering & Construction Company is 15%

If you want to know who really controls KEPCO Engineering & Construction Company, Inc. (KRX:052690), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are public companies with 51% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies as a group endured the highest losses last week after market cap fell by ₩107b.

In the chart below, we zoom in on the different ownership groups of KEPCO Engineering & Construction Company.

See our latest analysis for KEPCO Engineering & Construction Company

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

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.

We can see that KEPCO Engineering & Construction Company 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. 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 KEPCO Engineering & Construction Company, (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 KEPCO Engineering & Construction Company. Korea Electric Power Corporation is currently the largest shareholder, with 51% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. For context, the second largest shareholder holds about 8.4% of the shares outstanding, followed by an ownership of 3.3% by the third-largest shareholder.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of KEPCO Engineering & Construction Company

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that KEPCO Engineering & Construction Company, Inc. insiders own under 1% of the company. Keep in mind that it's a big company, and the insiders own ₩239m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 34% stake in the company, and hence can't easily be ignored. 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 51% of KEPCO Engineering & Construction Company. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.