TEMC Co., Ltd. (KOSDAQ:425040) surges 12%; retail investors who own 41% shares profited along with insiders

Key Insights

• Significant control over TEMC by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 5 shareholders own 52% of the company
• Insiders own 33% of TEMC

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A look at the shareholders of TEMC Co., Ltd. (KOSDAQ:425040) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 41% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 12% increase in the stock price last week, retail investors profited the most, but insiders who own 33% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of TEMC, beginning with the chart below.

Check out our latest analysis for TEMC

What Does The Institutional Ownership Tell Us About TEMC?

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 TEMC. 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 TEMC's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in TEMC. Our data shows that Wonyang Yu is the largest shareholder with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.4% and 5.0%, of the shares outstanding, respectively.

On looking further, we found that 52% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of TEMC

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 most recent data indicates that insiders own a reasonable proportion of TEMC Co., Ltd.. It has a market capitalization of just ₩218b, and insiders have ₩72b worth of shares in their own names. 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

The general public-- including retail investors -- own 41% stake in the company, and hence can't easily be ignored. 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 Equity Ownership

Private equity firms hold a 8.4% stake in TEMC. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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. Case in point: We've spotted 3 warning signs for TEMC you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.