Every investor in BOC Hong Kong (Holdings) Limited (HKG:2388) should be aware of the most powerful shareholder groups. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. We also tend to see lower insider ownership in companies that were previously publicly owned.
BOC Hong Kong (Holdings) is a pretty big company. It has a market capitalization of HK$259b. Normally institutions would own a significant portion of a company this size. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let’s delve deeper into each type of owner, to discover more about BOC Hong Kong (Holdings).
What Does The Institutional Ownership Tell Us About BOC Hong Kong (Holdings)?
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.
As you can see, institutional investors own 10% of BOC Hong Kong (Holdings). 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. 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 BOC Hong Kong (Holdings)’s earnings history, below. Of course, the future is what really matters.
We note that hedge funds don’t have a meaningful investment in BOC Hong Kong (Holdings). The company’s largest shareholder is Bank of China Limited, with ownership of 66%, With such a huge stake in the ownership, we infer that they have significant control of the future of the company. The second largest shareholder with 1.3%, is Capital Research and Management Company, followed by Hang Seng Investment Management Limited, with an ownership of 1.2%.
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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of BOC Hong Kong (Holdings)
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
Our data suggests that insiders own under 1% of BOC Hong Kong (Holdings) Limited in their own names. It is a very large company, so it would be surprising to see insiders own a large proportion of the company. Though their holding amounts to less than 1%, we can see that board members collectively own HK$20m worth of shares (at current prices). Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.
General Public Ownership
The general public holds a 24% stake in 2388. 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
It appears to us that public companies own 66% of 2388. 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.
It’s always worth thinking about the different groups who own shares in a company. But to understand BOC Hong Kong (Holdings) better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we’ve spotted with BOC Hong Kong (Holdings) .
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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. 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.
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