E-MART Inc.'s (KRX:139480) market cap rose ₩94b last week; retail investors who hold 47% profited and so did insiders

Key Insights

• Significant control over E-MART by retail investors implies that the general public has more power to influence management and governance-related decisions
• 50% of the business is held by the top 9 shareholders
• Insider ownership in E-MART is 30%

Our free stock report includes 2 warning signs investors should be aware of before investing in E-MART. Read for free now.

To get a sense of who is truly in control of E-MART Inc. (KRX:139480), it is important to understand the ownership structure of the business. With 47% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 3.9% increase in the stock price last week, retail investors profited the most, but insiders who own 30% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of E-MART.

View our latest analysis for E-MART

What Does The Institutional Ownership Tell Us About E-MART?

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.

E-MART 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. 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 E-MART, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in E-MART. Our data shows that Yong-Jin Chung is the largest shareholder with 30% of shares outstanding. With 13% and 2.7% of the shares outstanding respectively, National Pension Service and The Vanguard Group, Inc. are the second and third largest shareholders.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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 E-MART

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.

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 a reasonable proportion of E-MART Inc.. It has a market capitalization of just ₩2.5t, and insiders have ₩744b worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 47% stake in E-MART. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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 2 warning signs for E-MART (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

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.