What Kind Of Investors Own Most Of Hankook Cosmetics Co., Ltd. (KRX:123690)?

The big shareholder groups in Hankook Cosmetics Co., Ltd. (KRX:123690) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.

With a market capitalization of ₩199b, Hankook Cosmetics is a small cap stock, so it might not be well known by many institutional investors. In the chart below, we can see that institutions don't own shares in the company. We can zoom in on the different ownership groups, to learn more about Hankook Cosmetics.

View our latest analysis for Hankook Cosmetics

What Does The Lack Of Institutional Ownership Tell Us About Hankook Cosmetics?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Hankook Cosmetics' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

Hedge funds don't have many shares in Hankook Cosmetics. Looking at our data, we can see that the largest shareholder is Hankook Cosmetics Manufacturing Co., Ltd with 20% of shares outstanding. In comparison, the second and third largest shareholders hold about 16% and 12% of the stock. Furthermore, CEO Yong Lee is the owner of 4.7% of the company's shares.

Our research also brought to light the fact that roughly 53% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Hankook Cosmetics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

It seems insiders own a significant proportion of Hankook Cosmetics Co., Ltd.. It has a market capitalization of just ₩199b, and insiders have ₩66b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

With a 47% ownership, the general public have some degree of sway over Hankook Cosmetics. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Public Company Ownership

We can see that public companies hold 20% of the Hankook Cosmetics shares on issue. 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. To that end, you should be aware of the 1 warning sign we've spotted with Hankook Cosmetics .

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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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