How Much Of The Hongkong and Shanghai Hotels, Limited (HKG:45) Do Insiders Own?

A look at the shareholders of The Hongkong and Shanghai Hotels, Limited (HKG:45) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

Hongkong and Shanghai Hotels has a market capitalization of HK$11b, so we would expect some institutional investors to have noticed the stock. In the chart below, we can see that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholders can tell us about Hongkong and Shanghai Hotels.

Check out our latest analysis for Hongkong and Shanghai Hotels

What Does The Institutional Ownership Tell Us About Hongkong and Shanghai Hotels?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Hongkong and Shanghai Hotels does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Hongkong and Shanghai Hotels, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Hongkong and Shanghai Hotels. Looking at our data, we can see that the largest shareholder is Michael David Kadoorie with 43% of shares outstanding. Satinu Resources Group Limited, Asset Management Arm is the second largest shareholder owning 11% of common stock, and Ronald McAulay holds about 5.2% of the company stock. Ronald McAulay, who is the third-largest shareholder, also happens to hold the title of Chairman Emeritus.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Hongkong and Shanghai Hotels

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 most recent data indicates that insiders own a reasonable proportion of The Hongkong and Shanghai Hotels, Limited. Insiders own HK$5.5b worth of shares in the HK$11b 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

With a 34% ownership, the general public have some degree of sway over Hongkong and Shanghai Hotels. 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

It appears to us that public companies own 4.8% of Hongkong and Shanghai Hotels. 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:

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.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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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