Public companies who hold 72% of Nissin Foods Company Limited (HKG:1475) gained 9.1%, institutions profited as well

Key Insights

• Significant control over Nissin Foods by public companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is Nissin Foods Holdings Co.,Ltd. with a 72% stake
• Insiders have bought recently

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If you want to know who really controls Nissin Foods Company Limited (HKG:1475), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are public companies with 72% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 9.1% increase in the stock price last week, public companies profited the most, but institutions who own 15% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of Nissin Foods, beginning with the chart below.

Check out our latest analysis for Nissin Foods

What Does The Institutional Ownership Tell Us About Nissin Foods?

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 Nissin Foods. 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. 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 Nissin Foods' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Nissin Foods. Looking at our data, we can see that the largest shareholder is Nissin Foods Holdings Co.,Ltd. with 72% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. China Orient Asset Management (International) Holding Limited is the second largest shareholder owning 9.9% of common stock, and Merrill Lynch, Pierce, Fenner & Smith Incorporated holds about 4.6% of the company stock. In addition, we found that Kiyotaka Ando, the CEO has 2.1% of the shares allocated to their name.

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

Insider Ownership Of Nissin Foods

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.

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 Nissin Foods Company Limited. As individuals, the insiders collectively own HK$161m worth of the HK$7.7b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 11% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

We can see that public companies hold 72% of the Nissin Foods shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.