Individual investors who hold 59% of ENCell Co., Ltd. (KOSDAQ:456070) gained 21%, insiders profited as well

Key Insights

• ENCell's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 41% of the business is held by the top 10 shareholders
• 21% of ENCell is held by insiders

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To get a sense of who is truly in control of ENCell Co., Ltd. (KOSDAQ:456070), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While individual investors were the group that reaped the most benefits after last week’s 21% price gain, insiders also received a 21% cut.

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

See our latest analysis for ENCell

What Does The Institutional Ownership Tell Us About ENCell?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in ENCell. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 ENCell, (below). Of course, keep in mind that there are other factors to consider, too.

ENCell is not owned by hedge funds. Jongwook Jang is currently the company's largest shareholder with 18% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 4.3% of the stock.

Our studies suggest that the top 10 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 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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of ENCell

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.

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.

It seems insiders own a significant proportion of ENCell Co., Ltd.. It has a market capitalization of just ₩200b, and insiders have ₩41b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 59% stake in ENCell, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Equity Ownership

Private equity firms hold a 11% stake in ENCell. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand ENCell better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with ENCell (including 2 which shouldn't be ignored) .

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.