Senior Key Executive Junyu Hou, China Chunlai Education Group Co., Ltd.'s (HKG:1969) largest shareholder sees value of holdings go down 6.4% after recent drop

Key Insights

• Insiders appear to have a vested interest in China Chunlai Education Group's growth, as seen by their sizeable ownership
• The largest shareholder of the company is Junyu Hou with a 75% stake
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in China Chunlai Education Group Co., Ltd. (HKG:1969) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 75% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to HK$6.2b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about China Chunlai Education Group.

View our latest analysis for China Chunlai Education Group

What Does The Lack Of Institutional Ownership Tell Us About China Chunlai Education Group?

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 could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. Alternatively, there might be something about the company that has kept institutional investors away. China Chunlai Education Group might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

China Chunlai Education Group is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In China Chunlai Education Group's case, its Senior Key Executive, Junyu Hou, is the largest shareholder, holding 75% of shares outstanding. With 5.5% and 0.05% of the shares outstanding respectively, Xiang Rong International Limited and BNY Mellon Asset Management are the second and third largest shareholders.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of China Chunlai Education Group

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems that insiders own more than half the China Chunlai Education Group Co., Ltd. stock. This gives them a lot of power. That means they own HK$4.6b worth of shares in the HK$6.2b company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 19% ownership, the general public, mostly comprising of individual investors, have some degree of sway over China Chunlai Education Group. 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 5.5%, of the China Chunlai Education Group 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:

It's always worth thinking about the different groups who own shares in a company. But to understand China Chunlai Education Group better, we need to consider many other factors. Be aware that China Chunlai Education Group is showing 1 warning sign in our investment analysis , you should know about...

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.