Envision Greenwise Holdings Limited's (HKG:1783) stock price dropped 8.4% last week; retail investors would not be happy

Key Insights

• Envision Greenwise Holdings' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 50% of the business is held by the top 11 shareholders
• Recent purchases by insiders

A look at the shareholders of Envision Greenwise Holdings Limited (HKG:1783) can tell us which group is most powerful. We can see that retail investors own the lion's share in the company with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 8.4% decrease in the stock price last week, retail investors suffered the most losses, but insiders who own 49% stock also took a hit.

Let's delve deeper into each type of owner of Envision Greenwise Holdings, beginning with the chart below.

View our latest analysis for Envision Greenwise Holdings

What Does The Lack Of Institutional Ownership Tell Us About Envision Greenwise Holdings?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Envision Greenwise Holdings' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

We note that hedge funds don't have a meaningful investment in Envision Greenwise Holdings. Our data suggests that Chun Sing Kwok, who is also the company's Top Key Executive, holds the most number of shares at 47%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. With 2.0% and 0.5% of the shares outstanding respectively, Chi Kin Tang and Zhi Hao Zhan are the second and third largest shareholders. Interestingly, the second and third-largest shareholders also happen to be the Senior Key Executive and Member of the Board of Directors, respectively. This once again signifies considerable insider ownership amongst the company's top shareholders.

On studying our ownership data, we found that 11 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. 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 Envision Greenwise Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Envision Greenwise Holdings Limited. It has a market capitalization of just HK$9.7b, and insiders have HK$4.8b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public -- including retail investors -- own 50% of Envision Greenwise Holdings. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Envision Greenwise Holdings (1 doesn't sit too well with us) that you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.