Individual investors in HD-Hyundai Marine Engine Co., Ltd. (KRX:071970) are its biggest bettors, and their bets paid off as stock gained 16% last week

Key Insights

• The considerable ownership by individual investors in HD-Hyundai Marine Engine indicates that they collectively have a greater say in management and business strategy
• A total of 22 investors have a majority stake in the company with 48% ownership
• Institutions own 13% of HD-Hyundai Marine Engine

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If you want to know who really controls HD-Hyundai Marine Engine Co., Ltd. (KRX:071970), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 52% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors collectively scored the highest last week as the company hit ₩3.1t market cap following a 16% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about HD-Hyundai Marine Engine.

Check out our latest analysis for HD-Hyundai Marine Engine

What Does The Institutional Ownership Tell Us About HD-Hyundai Marine Engine?

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.

As you can see, institutional investors have a fair amount of stake in HD-Hyundai Marine Engine. 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. 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 HD-Hyundai Marine Engine's historic earnings and revenue below, but keep in mind there's always more to the story.

HD-Hyundai Marine Engine is not owned by hedge funds. Our data shows that HD Korea Shipbuilding & Offshore Engineering Co., Ltd. is the largest shareholder with 35% of shares outstanding. For context, the second largest shareholder holds about 6.1% of the shares outstanding, followed by an ownership of 3.8% by the third-largest shareholder.

On studying our ownership data, we found that 22 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of HD-Hyundai Marine Engine

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.

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 less than 1% of HD-Hyundai Marine Engine Co., Ltd.. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own ₩1.2b worth of shares. 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, mostly comprising of individual investors, collectively holds 52% of HD-Hyundai Marine Engine 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.

Public Company Ownership

It appears to us that public companies own 35% of HD-Hyundai Marine Engine. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with HD-Hyundai Marine Engine , and understanding them should be part of your investment process.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.