Institutional investors control 41% of Korean Reinsurance Company (KRX:003690) and were rewarded last week after stock increased 5.1%

Key Insights

• Institutions' substantial holdings in Korean Reinsurance implies that they have significant influence over the company's share price
• 51% of the business is held by the top 8 shareholders
• 24% of Korean Reinsurance is held by insiders

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Every investor in Korean Reinsurance Company (KRX:003690) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 41% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And things are looking up for institutional investors after the company gained ₩72b in market cap last week. The one-year return on investment is currently 37% and last week's gain would have been more than welcomed.

In the chart below, we zoom in on the different ownership groups of Korean Reinsurance.

View our latest analysis for Korean Reinsurance

What Does The Institutional Ownership Tell Us About Korean Reinsurance?

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 Korean Reinsurance. 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. 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 Korean Reinsurance's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Korean Reinsurance. In-Soon Jang is currently the largest shareholder, with 11% of shares outstanding. SHINYOUNG Asset Management Co., Ltd. is the second largest shareholder owning 9.8% of common stock, and National Pension Service holds about 8.3% of the company stock. Furthermore, CEO Jong-Gyu Won is the owner of 5.1% of the company's shares.

We did some more digging and found that 8 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 Korean Reinsurance

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Korean Reinsurance Company. It has a market capitalization of just ₩1.5t, and insiders have ₩356b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public-- including retail investors -- own 35% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Korean Reinsurance better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.