What does the ownership structure look like for Haitian International Holdings Limited (HKG: 1882)?
The large shareholder groups of Haitian International Holdings Limited (HKG: 1882) have power over the company. Generally speaking, as a business grows, institutions increase their participation. Conversely, insiders often decrease their ownership over time. Companies that were previously owned by the state tend to have fewer insiders.
With a market capitalization of HK $ 44 billion, Haitian International Holdings is quite large. We would expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. In the graph below, we can see that institutional investors have bought into the company. We can zoom in on the different ownership groups, to find out more about Haitian International Holdings.
Check out our latest analysis for Haitian International Holdings
What does institutional ownership tell us about Haitian International Holdings?
Institutional investors generally compare their own returns to the returns of a commonly tracked index. They therefore generally consider buying larger companies that are included in the relevant benchmark.
We can see that Haitian International Holdings has institutional investors; and they own a large portion of the company’s stock. This may indicate that the company has a certain degree of credibility in the investment community. However, it’s best to beware of relying on the so-called validation that comes with institutional investors. They too are sometimes wrong. It is not uncommon to see a sharp drop in the stock price if two large institutional investors attempt to sell a stock at the same time. So it’s worth checking out Haitian International Holdings’ past earnings trajectory (below). Of course, keep in mind that there are other factors to consider as well.
Hedge funds don’t have a lot of shares in Haitian International Holdings. The company’s largest shareholder is Sky Treasure Capital Limited, with a 27% stake. In comparison, the second and third shareholders hold around 20% and 12% of the capital. In addition, the company’s CEO, Jianming Zhang, directly owns 0.5% of the total shares outstanding.
A more detailed study of the register of shareholders showed us that 3 of the main shareholders hold a considerable share of the ownership of the company, through their 59% stake.
Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be achieved by studying the feelings of analysts. There are a reasonable number of analysts covering the stock, so it can be helpful to know their overall vision for the future.
Insider ownership of Haitian International Holdings
The definition of an insider may differ slightly from country to country, but board members still count. The management of the company manages the company, but the CEO will report to the board of directors, even if he is a member of the board.
Insider ownership is positive when it indicates that executives think like the real owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
Our most recent data indicates that insiders own less than 1% of Haitian International Holdings Limited. But they can have an indirect interest through a business structure that we have not chosen. Keep in mind that this is a large company and insiders own shares worth HK $ 296 million. The absolute value can be more important than the proportional part. Arguably recent purchases and sales are equally important to consider. You can click here to see if any insiders have bought or sold.
General public property
With 19% ownership, the general public has some influence over Haitian International Holdings. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in line with other large shareholders.
With a 20% stake, private equity firms are able to play a role in shaping corporate strategy with an emphasis on value creation. Sometimes we see private equity sticking around for the long haul, but generally they have a shorter investment horizon and – as the name suggests – don’t invest much in public companies. After a while, they may seek to sell and redeploy the capital elsewhere.
Owned by a private company
It appears that private companies own 39% of the shares of Haitian International Holdings. Private companies can be related parties. Sometimes insiders have an interest in a public company through a stake in a private company, rather than in their own capacity as an individual. While it is difficult to draw general conclusions, it should be noted that this is an additional area of research.
I find it very interesting to see who exactly owns a company. But to really get an overview, we have to take other information into account as well. For example, we discovered 1 warning sign for Haitian International Holdings which you should know before investing here.
But finally it’s the future, not the past, which will determine the success of the owners of this business. Therefore, we believe it is advisable to take a look at this free report showing whether analysts are predicting a better future.
NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
When trading stocks or any other investment, use the platform seen by many as the professionals’ gateway to the global market, Interactive brokers. You get the cheapest * trading on stocks, options, futures, forex, bonds and funds from around the world from a single integrated account. Promoted
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020
Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.