Visual Photonics Epitaxy Co., Ltd.'s (TWSE:2455) high institutional ownership speaks for itself as stock continues to impress, up 7.7% over last week

Key Insights

• Institutions' substantial holdings in Visual Photonics Epitaxy implies that they have significant influence over the company's share price
• The top 19 shareholders own 51% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of Visual Photonics Epitaxy Co., Ltd. (TWSE:2455), it is important to understand the ownership structure of the business. With 48% stake, institutions possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And things are looking up for institutional investors after the company gained NT$1.8b in market cap last week. The one-year return on investment is currently 11% and last week's gain would have been more than welcomed.

Let's take a closer look to see what the different types of shareholders can tell us about Visual Photonics Epitaxy.

See our latest analysis for Visual Photonics Epitaxy

What Does The Institutional Ownership Tell Us About Visual Photonics Epitaxy?

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 Visual Photonics Epitaxy does have institutional investors; and they hold a good portion of the company's stock. 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 Visual Photonics Epitaxy, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Visual Photonics Epitaxy. New Labor Pension Scheme is currently the company's largest shareholder with 7.3% of shares outstanding. In comparison, the second and third largest shareholders hold about 3.9% and 3.3% of the stock. In addition, we found that Chao-Hsing Huang, the CEO has 0.8% of the shares allocated to their name.

Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 19 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Visual Photonics Epitaxy

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.

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.

Shareholders would probably be interested to learn that insiders own shares in Visual Photonics Epitaxy Co., Ltd.. As individuals, the insiders collectively own NT$1.8b worth of the NT$25b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 37% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

Our data indicates that Private Companies hold 7.5%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Visual Photonics Epitaxy better, we need to consider many other factors. For example, we've discovered 1 warning sign for Visual Photonics Epitaxy that you should be aware of before investing here.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.