ALUX Co., Ltd.'s (KOSDAQ:475580) most bullish insider, CEO Chi-Heon Lee must be pleased with the recent 12% gain
Key Insights
- Insiders appear to have a vested interest in ALUX's growth, as seen by their sizeable ownership
- The top 9 shareholders own 50% of the company
- Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
If you want to know who really controls ALUX Co., Ltd. (KOSDAQ:475580), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 48% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Clearly, insiders benefitted the most after the company's market cap rose by ₩16b last week.
Let's take a closer look to see what the different types of shareholders can tell us about ALUX.
Check out our latest analysis for ALUX
What Does The Institutional Ownership Tell Us About ALUX?
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.
Institutions have a very small stake in ALUX. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.
We note that hedge funds don't have a meaningful investment in ALUX. The company's CEO Chi-Heon Lee is the largest shareholder with 24% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.0% and 5.2% of the stock.
We did some more digging and found that 9 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 ALUX
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
It seems insiders own a significant proportion of ALUX Co., Ltd.. Insiders own ₩74b worth of shares in the ₩153b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.
General Public Ownership
With a 47% ownership, the general public, mostly comprising of individual investors, have some degree of sway over ALUX. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with ALUX , and understanding them should be part of your investment process.
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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.