Focus Systems Corporation's (TSE:4662) market cap touched JP¥32b last week, benefiting both retail investors who own 59% as well as institutions

Key Insights

• The considerable ownership by retail investors in Focus Systems indicates that they collectively have a greater say in management and business strategy
• 41% of the business is held by the top 25 shareholders
• 23% of Focus Systems is held by Institutions

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Every investor in Focus Systems Corporation (TSE:4662) should be aware of the most powerful shareholder groups. We can see that retail investors own the lion's share in the company with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 25% increase in the stock price last week, retail investors profited the most, but institutions who own 23% stock also stood to gain from the increase.

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

See our latest analysis for Focus Systems

What Does The Institutional Ownership Tell Us About Focus Systems?

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.

We can see that Focus Systems does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Focus Systems' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Focus Systems. Our data shows that FMR LLC is the largest shareholder with 9.9% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.9% and 4.5% of the stock. Additionally, the company's CEO Keiichi Mori directly holds 1.8% of the total shares outstanding.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 Focus Systems

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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Shareholders would probably be interested to learn that insiders own shares in Focus Systems Corporation. As individuals, the insiders collectively own JP¥2.7b worth of the JP¥32b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 59% stake in Focus Systems, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Public Company Ownership

It appears to us that public companies own 5.9% of Focus Systems. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Focus Systems is showing 3 warning signs in our investment analysis , you should know about...

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.