Individual investors are LX Semicon Co., Ltd.'s (KRX:108320) biggest owners and were rewarded after market cap rose by ₩96b last week

Key Insights

• The considerable ownership by individual investors in LX Semicon indicates that they collectively have a greater say in management and business strategy
• The top 10 shareholders own 50% of the company
• 20% of LX Semicon is held by Institutions

To get a sense of who is truly in control of LX Semicon Co., Ltd. (KRX:108320), it is important to understand the ownership structure of the business. With 47% stake, individual investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, individual investors benefitted the most after the company's market cap rose by ₩96b last week.

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

Check out our latest analysis for LX Semicon

What Does The Institutional Ownership Tell Us About LX Semicon?

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.

LX Semicon already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of LX Semicon, (below). Of course, keep in mind that there are other factors to consider, too.

LX Semicon is not owned by hedge funds. The company's largest shareholder is LX Holdings Corp., with ownership of 33%. For context, the second largest shareholder holds about 6.1% of the shares outstanding, followed by an ownership of 2.4% by the third-largest shareholder.

We also observed that the top 10 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of LX Semicon

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that LX Semicon Co., Ltd. insiders own under 1% of the company. It has a market capitalization of just ₩1.0t, and the board has only ₩1.5b worth of shares in their own names. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

The general public, who are usually individual investors, hold a 47% stake in LX Semicon. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

Public companies currently own 33% of LX Semicon stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand LX Semicon better, we need to consider many other factors. For instance, we've identified 1 warning sign for LX Semicon that you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.