Swee Ann Teo Espressif Systems (Shanghai) Co., Ltd.'s (SHSE:688018) CEO is the most bullish insider, and their stock value gained 3.7%last week

Key Insights

• Espressif Systems (Shanghai)'s significant insider ownership suggests inherent interests in company's expansion
• The top 5 shareholders own 51% of the company
• Institutions own 25% of Espressif Systems (Shanghai)

A look at the shareholders of Espressif Systems (Shanghai) Co., Ltd. (SHSE:688018) can tell us which group is most powerful. With 41% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, insiders benefitted the most after the company's market cap rose by CN¥943m last week.

Let's delve deeper into each type of owner of Espressif Systems (Shanghai), beginning with the chart below.

View our latest analysis for Espressif Systems (Shanghai)

What Does The Institutional Ownership Tell Us About Espressif Systems (Shanghai)?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Espressif Systems (Shanghai). 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 Espressif Systems (Shanghai)'s earnings history below. Of course, the future is what really matters.

Espressif Systems (Shanghai) is not owned by hedge funds. With a 41% stake, CEO Swee Ann Teo is the largest shareholder. For context, the second largest shareholder holds about 3.6% of the shares outstanding, followed by an ownership of 2.5% by the third-largest shareholder.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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

Insider Ownership Of Espressif Systems (Shanghai)

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our information suggests that insiders maintain a significant holding in Espressif Systems (Shanghai) Co., Ltd.. Insiders own CN¥11b worth of shares in the CN¥26b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

It seems that Private Companies own 4.3%, of the Espressif Systems (Shanghai) stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Espressif Systems (Shanghai) better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Espressif Systems (Shanghai) .

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.