Retail investors who hold 46% of S&D Co., Ltd (KOSDAQ:260970) gained 23%, insiders profited as well

Key Insights

• The considerable ownership by retail investors in S&D indicates that they collectively have a greater say in management and business strategy
• The top 4 shareholders own 52% of the company
• 44% of S&D is held by insiders

To get a sense of who is truly in control of S&D Co., Ltd (KOSDAQ:260970), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 46% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Retail investors gained the most after market cap touched ₩162b last week, while insiders who own 44% also benefitted.

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

Check out our latest analysis for S&D

What Does The Institutional Ownership Tell Us About S&D?

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.

We can see that S&D does have institutional investors; and they hold a good portion of the company's stock. 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. 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 S&D's historic earnings and revenue below, but keep in mind there's always more to the story.

S&D is not owned by hedge funds. With a 38% stake, CEO Kyung-Mok Yeo is the largest shareholder. Sang-Wan Yeo is the second largest shareholder owning 5.4% of common stock, and Korea Securities Finance Corporation, Investment Arm holds about 4.5% of the company stock. Interestingly, the second-largest shareholder, Sang-Wan Yeo is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

Our research also brought to light the fact that roughly 52% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of S&D

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

Our most recent data indicates that insiders own a reasonable proportion of S&D Co., Ltd. Insiders have a ₩72b stake in this ₩162b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. 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 46% stake in S&D. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - S&D has 1 warning sign we think you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.