Public companies are Sands China Ltd.'s (HKG:1928) biggest owners and were rewarded after market cap rose by HK$23b last week

By
Simply Wall St
Published
January 19, 2022
SEHK:1928
Source: Shutterstock

If you want to know who really controls Sands China Ltd. (HKG:1928), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 70% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, public companies were the biggest beneficiaries of last week’s 16% gain.

Let's delve deeper into each type of owner of Sands China, beginning with the chart below.

See our latest analysis for Sands China

ownership-breakdown
SEHK:1928 Ownership Breakdown January 19th 2022

What Does The Institutional Ownership Tell Us About Sands China?

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 Sands China. 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 Sands China's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
SEHK:1928 Earnings and Revenue Growth January 19th 2022

We note that hedge funds don't have a meaningful investment in Sands China. Las Vegas Sands Corp. is currently the company's largest shareholder with 70% of shares outstanding. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 1.7% of the shares outstanding, followed by an ownership of 1.0% by the third-largest shareholder.

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 Sands China

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.

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.

We note our data does not show any board members holding shares, personally. We do not see this low level of ownership often, and it is possible our data is imperfect. But shareholders can click here to check if insiders have been selling stock.

General Public Ownership

The general public-- including retail investors -- own 16% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

Public companies currently own 70% of Sands China stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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 1 warning sign for Sands China that you should be aware of.

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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