retail investors who own 49% along with institutions invested in King Yuan Electronics Co., Ltd. (TWSE:2449) saw increase in their holdings value last week

Key Insights

• Significant control over King Yuan Electronics by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 46% of the company
• Institutions own 40% of King Yuan Electronics

To get a sense of who is truly in control of King Yuan Electronics Co., Ltd. (TWSE:2449), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 49% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that benefitted the most from last week’s NT$6.7b market cap gain, institutions too had a 40% share in those profits.

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

View our latest analysis for King Yuan Electronics

What Does The Institutional Ownership Tell Us About King Yuan Electronics?

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.

King Yuan Electronics already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 King Yuan Electronics' historic earnings and revenue below, but keep in mind there's always more to the story.

King Yuan Electronics is not owned by hedge funds. Yuanta Securities Investment Trust Co., Ltd. is currently the company's largest shareholder with 5.4% of shares outstanding. With 4.3% and 4.1% of the shares outstanding respectively, Yann Yuan Investment Co., Ltd. and Fuh Hwa Securities Investment Trust Co., Ltd. are the second and third largest shareholders.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 King Yuan Electronics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

We can see that insiders own shares in King Yuan Electronics Co., Ltd.. The insiders have a meaningful stake worth NT$6.9b. Most would see this as a real positive. It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 49% stake in King Yuan Electronics. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 4.3%, of the company's shares. 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:

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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for King Yuan Electronics you should know about.

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.