Individual investors who hold 55% of LARGAN Precision Co.,Ltd (TWSE:3008) gained 3.3%, institutions profited as well

Key Insights

• LARGAN PrecisionLtd's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 25 shareholders own 42% of the company
• Institutional ownership in LARGAN PrecisionLtd is 27%

To get a sense of who is truly in control of LARGAN Precision Co.,Ltd (TWSE:3008), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 55% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors gained the most after market cap touched NT$309b last week, while institutions who own 27% also benefitted.

In the chart below, we zoom in on the different ownership groups of LARGAN PrecisionLtd.

Check out our latest analysis for LARGAN PrecisionLtd

What Does The Institutional Ownership Tell Us About LARGAN PrecisionLtd?

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.

As you can see, institutional investors have a fair amount of stake in LARGAN PrecisionLtd. 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. 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 LARGAN PrecisionLtd, (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 LARGAN PrecisionLtd. Our data shows that Maoyu Memorial Co., Ltd. is the largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 3.1% and 3.0% of the stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 LARGAN PrecisionLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own some shares in LARGAN Precision Co.,Ltd. It is a very large company, and board members collectively own NT$14b worth of shares (at current prices). we sometimes take an interest in whether they have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 55% of LARGAN PrecisionLtd shares. 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.

Private Company Ownership

We can see that Private Companies own 14%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with LARGAN PrecisionLtd , and understanding them should be part of your investment process.

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.