Institutions profited after ASUSTeK Computer Inc.'s (TWSE:2357) market cap rose NT$31b last week but retail investors profited the most

Key Insights

• ASUSTeK Computer's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 36% of the business is held by the top 25 shareholders
• Institutional ownership in ASUSTeK Computer is 34%

A look at the shareholders of ASUSTeK Computer Inc. (TWSE:2357) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 58% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that reaped the most benefits after last week’s 6.9% price gain, institutions also received a 34% cut.

In the chart below, we zoom in on the different ownership groups of ASUSTeK Computer.

See our latest analysis for ASUSTeK Computer

What Does The Institutional Ownership Tell Us About ASUSTeK Computer?

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.

As you can see, institutional investors have a fair amount of stake in ASUSTeK Computer. 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. 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 ASUSTeK Computer's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in ASUSTeK Computer. Looking at our data, we can see that the largest shareholder is BlackRock, Inc. with 4.3% of shares outstanding. Cathay Securities Investment Trust Co., LTD is the second largest shareholder owning 4.2% of common stock, and Jonney Shih holds about 4.1% of the company stock. Jonney Shih, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

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 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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of ASUSTeK Computer

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.

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.

We can see that insiders own shares in ASUSTeK Computer Inc.. Insiders own NT$28b worth of shares (at current prices). It is good to see this level of investment. 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 substantial 58% stake in ASUSTeK Computer, suggesting it is a fairly popular stock. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

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. For instance, we've identified 1 warning sign for ASUSTeK Computer that you should be aware of.

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.