Individual investors in HD Hyundai Construction Equipment Co., LTD. (KRX:267270) are its biggest bettors, and their bets paid off as stock gained 8.1% last week

Key Insights

• Significant control over HD Hyundai Construction Equipment by individual investors implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 4 shareholders
• 23% of HD Hyundai Construction Equipment is held by Institutions

To get a sense of who is truly in control of HD Hyundai Construction Equipment Co., LTD. (KRX:267270), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 40% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors were the biggest beneficiaries of last week’s 8.1% gain.

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

Check out our latest analysis for HD Hyundai Construction Equipment

What Does The Institutional Ownership Tell Us About HD Hyundai Construction Equipment?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

HD Hyundai Construction Equipment 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 HD Hyundai Construction Equipment'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 HD Hyundai Construction Equipment. Our data shows that HD Hyundai Co., Ltd. is the largest shareholder with 37% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 9.9% and 2.7%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of HD Hyundai Construction Equipment

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 data suggests that insiders own under 1% of HD Hyundai Construction Equipment Co., LTD. in their own names. It has a market capitalization of just ₩1.1t, and the board has only ₩325m worth of shares in their own names. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 40% ownership, the general public, mostly comprising of individual investors, have some degree of sway over HD Hyundai Construction Equipment. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

Public companies currently own 37% of HD Hyundai Construction Equipment stock. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand HD Hyundai Construction Equipment better, we need to consider many other factors. Take risks for example - HD Hyundai Construction Equipment has 2 warning signs we think you should be aware of.

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.

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.