Webzen Inc.'s (KOSDAQ:069080) market cap dropped ₩55b last week; Retail investors bore the brunt

Key Insights

• The considerable ownership by retail investors in Webzen indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 57% ownership
• 33% of Webzen is held by insiders

To get a sense of who is truly in control of Webzen Inc. (KOSDAQ:069080), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are retail investors with 36% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders, who own 33% shares weren’t spared from last week’s ₩55b market cap drop, retail investors as a group suffered the maximum losses

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

View our latest analysis for Webzen

What Does The Institutional Ownership Tell Us About Webzen?

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.

As you can see, institutional investors have a fair amount of stake in Webzen. 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 Webzen's earnings history below. Of course, the future is what really matters.

Webzen is not owned by hedge funds. Byoung Gwan Kim is currently the company's largest shareholder with 32% of shares outstanding. In comparison, the second and third largest shareholders hold about 24% and 1.6% of the stock. Furthermore, CEO Tae Young Kim is the owner of 0.5% of the company's shares.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 57% stake.

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 Webzen

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Webzen Inc.. Insiders own ₩147b worth of shares in the ₩445b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 36% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Webzen. 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.

Private Company Ownership

We can see that Private Companies own 24%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

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

I always like to check for a history of revenue growth. You can too, by accessing this free chart of 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.