Jeju Air Co., Ltd.'s (KRX:089590) market cap surged ₩74b last week, public companies who have a lot riding on the company were rewarded

Key Insights

• Significant control over Jeju Air by public companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is AK Holdings, Inc. with a 50% stake
• 11% of Jeju Air is held by Institutions

If you want to know who really controls Jeju Air Co., Ltd. (KRX:089590), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 50% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, public companies collectively scored the highest last week as the company hit ₩763b market cap following a 11% gain in the stock.

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

See our latest analysis for Jeju Air

What Does The Institutional Ownership Tell Us About Jeju Air?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

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

Jeju Air is not owned by hedge funds. Our data shows that AK Holdings, Inc. is the largest shareholder with 50% of shares outstanding. This implies that they have majority interest control of the future of the company. National Pension Service is the second largest shareholder owning 7.1% of common stock, and AK INNOVATION SERVICES CO., ltd holds about 3.2% of the company stock.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Jeju Air

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. 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.

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 less than 1% of Jeju Air Co., Ltd.. But they may have an indirect interest through a corporate structure that we haven't picked up on. It seems the board members have no more than ₩170m worth of shares in the ₩763b company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 34% 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

We can see that Private Companies own 3.2%, 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.

Public Company Ownership

We can see that public companies hold 50% of the Jeju Air shares on issue. 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:

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 Jeju Air , 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.