AMOREPACIFIC Group (KRX:002790) CEO Kyungbae Suh, the company's largest shareholder sees 8.9% reduction in holdings value

Key Insights

• Significant insider control over AMOREPACIFIC Group implies vested interests in company growth
• 54% of the company is held by a single shareholder (Kyungbae Suh)
• 16% of AMOREPACIFIC Group is held by Institutions

If you want to know who really controls AMOREPACIFIC Group (KRX:002790), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 57% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders as a group endured the highest losses after market cap fell by ₩193b.

Let's take a closer look to see what the different types of shareholders can tell us about AMOREPACIFIC Group.

Check out our latest analysis for AMOREPACIFIC Group

What Does The Institutional Ownership Tell Us About AMOREPACIFIC Group?

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.

AMOREPACIFIC Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 AMOREPACIFIC Group's earnings history below. Of course, the future is what really matters.

AMOREPACIFIC Group is not owned by hedge funds. The company's CEO Kyungbae Suh is the largest shareholder with 54% of shares outstanding. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. National Pension Service is the second largest shareholder owning 6.4% of common stock, and Sung Hwan Welfare Fund holds about 2.8% of the company stock.

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. 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 AMOREPACIFIC Group

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.

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 information suggests that insiders own more than half of AMOREPACIFIC Group. This gives them effective control of the company. Given it has a market cap of ₩1.8t, that means insiders have a whopping ₩1.0t worth of shares in their own names. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

The general public, who are usually individual investors, hold a 28% stake in AMOREPACIFIC Group. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand AMOREPACIFIC Group better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for AMOREPACIFIC Group you should be aware of, and 1 of them is a bit unpleasant.

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.