What You Need To Know About Namchow Holdings Co., Ltd.'s (TPE:1702) Investor Composition

If you want to know who really controls Namchow Holdings Co., Ltd. (TPE:1702), then you'll have to look at the makeup of its share registry. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

Namchow Holdings is a smaller company with a market capitalization of NT$11b, so it may still be flying under the radar of many institutional investors. In the chart below, we can see that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about Namchow Holdings.

See our latest analysis for Namchow Holdings

What Does The Institutional Ownership Tell Us About Namchow Holdings?

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 Namchow Holdings does have institutional investors; and they hold a good portion of the company's stock. 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 Namchow Holdings' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Namchow Holdings. Lucky Royal Company Limited is currently the largest shareholder, with 19% of shares outstanding. The second and third largest shareholders are Fei-Peng Chen and Fei-Lung Chen, with an equal amount of shares to their name at 15%. Fei-Lung Chen, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

Our research also brought to light the fact that roughly 51% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Namchow Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our information suggests that insiders maintain a significant holding in Namchow Holdings Co., Ltd.. It has a market capitalization of just NT$11b, and insiders have NT$3.6b 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 holds a 42% stake in Namchow Holdings. 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

It seems that Private Companies own 19%, of the Namchow Holdings stock. 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 Namchow Holdings better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Namchow Holdings you should be aware of, and 2 of them are a bit unpleasant.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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