HNA Technology Co.,Ltd.'s (SHSE:600751) last week's 4.3% decline must have disappointed retail investors who have a significant stake

Key Insights

• HNA TechnologyLtd's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 24 investors have a majority stake in the company with 46% ownership
• 16% of HNA TechnologyLtd is held by Institutions

To get a sense of who is truly in control of HNA Technology Co.,Ltd. (SHSE:600751), it is important to understand the ownership structure of the business. With 54% stake, retail investors 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.

And last week, retail investors endured the biggest losses as the stock fell by 4.3%.

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

View our latest analysis for HNA TechnologyLtd

What Does The Institutional Ownership Tell Us About HNA TechnologyLtd?

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 HNA TechnologyLtd does have institutional investors; and they hold a good portion of the company's stock. 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 HNA TechnologyLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in HNA TechnologyLtd. Our data shows that HNA Group Bankruptcy Reorganisation Specialised Service Trust is the largest shareholder with 29% of shares outstanding. With 14% and 0.7% of the shares outstanding respectively, Guohua Life Insurance Co., Ltd, Asset Management Arm and Founder Fubon Fund Management Co., Ltd. are the second and third largest shareholders.

On studying our ownership data, we found that 24 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. 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 HNA TechnologyLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 data suggests that insiders own under 1% of HNA Technology Co.,Ltd. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around CN¥11m 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, mostly comprising of individual investors, collectively holds 54% of HNA TechnologyLtd shares. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Private Company Ownership

It seems that Private Companies own 29%, of the HNA TechnologyLtd 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For example, we've discovered 2 warning signs for HNA TechnologyLtd (1 is potentially serious!) that you should be aware of before investing here.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.