uPI Semiconductor Corp.'s (TWSE:6719) market cap dropped NT$1.7b last week; Individual investors bore the brunt

Key Insights

• Significant control over uPI Semiconductor by individual investors implies that the general public has more power to influence management and governance-related decisions
• 50% of the business is held by the top 7 shareholders
• 13% of uPI Semiconductor is held by Institutions

To get a sense of who is truly in control of uPI Semiconductor Corp. (TWSE:6719), it is important to understand the ownership structure of the business. With 46% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors as a group endured the highest losses last week after market cap fell by NT$1.7b.

In the chart below, we zoom in on the different ownership groups of uPI Semiconductor.

See our latest analysis for uPI Semiconductor

What Does The Institutional Ownership Tell Us About uPI Semiconductor?

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.

We can see that uPI Semiconductor 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. 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 uPI Semiconductor's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in uPI Semiconductor. Yageo Corporation is currently the largest shareholder, with 20% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 19% and 3.6%, of the shares outstanding, respectively.

We also observed that the top 7 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 uPI Semiconductor

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.

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 most recent data indicates that insiders own less than 1% of uPI Semiconductor Corp.. It appears that the board holds about NT$61m worth of stock. This compares to a market capitalization of NT$23b. 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 46% 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.

Public Company Ownership

Public companies currently own 40% of uPI Semiconductor stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

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

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.