Everbright Securities Company Limited's (SHSE:601788) largest shareholders are private companies with 49% ownership, individual investors own 33%

Key Insights

• Significant control over Everbright Securities by private companies implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 3 shareholders
• 15% of Everbright Securities is held by Institutions

To get a sense of who is truly in control of Everbright Securities Company Limited (SHSE:601788), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Individual investors, on the other hand, account for 33% of the company's stockholders.

In the chart below, we zoom in on the different ownership groups of Everbright Securities.

View our latest analysis for Everbright Securities

What Does The Institutional Ownership Tell Us About Everbright Securities?

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 have a fair amount of stake in Everbright Securities. 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 Everbright Securities' earnings history below. Of course, the future is what really matters.

Everbright Securities is not owned by hedge funds. The company's largest shareholder is China Everbright Group Ltd., with ownership of 46%. For context, the second largest shareholder holds about 3.1% of the shares outstanding, followed by an ownership of 2.8% by the third-largest shareholder.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Everbright Securities

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. 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.

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 information suggests that Everbright Securities Company Limited insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own CN¥232m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Everbright Securities. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 49%, of the Everbright Securities stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

We can see that public companies hold 3.1% of the Everbright Securities shares on issue. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Everbright Securities better, we need to consider many other factors. For example, we've discovered 3 warning signs for Everbright Securities that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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. 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.