Institutions profited after DB HiTek CO., LTD.'s (KRX:000990) market cap rose ₩74b last week but individual investors profited the most

Key Insights

• DB HiTek's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 22 shareholders own 50% of the company
• 25% of DB HiTek is held by Institutions

A look at the shareholders of DB HiTek CO., LTD. (KRX:000990) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual investors with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 5.7% increase in the stock price last week, individual investors profited the most, but institutions who own 25% stock also stood to gain from the increase.

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

View our latest analysis for DB HiTek

What Does The Institutional Ownership Tell Us About DB HiTek?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

DB HiTek already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 DB HiTek's historic earnings and revenue below, but keep in mind there's always more to the story.

DB HiTek is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is DB Group with 20% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 3.9%, of the shares outstanding, respectively. Jun-Gi Kim, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

After doing some more digging, we found that the top 22 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of DB HiTek

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

We can report that insiders do own shares in DB HiTek CO., LTD.. In their own names, insiders own ₩60b worth of stock in the ₩1.4t company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 49% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

Our data indicates that Private Companies hold 22%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with DB HiTek , and understanding them should be part of your investment process.

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.