Despite selling recently, Dashan Education Holdings Limited (HKG:9986) insiders own 61% stake and recent decline might have cost them

Key Insights

• Insiders appear to have a vested interest in Dashan Education Holdings' growth, as seen by their sizeable ownership
• A total of 2 investors have a majority stake in the company with 61% ownership
• Insiders have sold recently

If you want to know who really controls Dashan Education Holdings Limited (HKG:9986), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 61% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And our data suggests that insiders own the top position in the company’s share registry despite recent sales. As a result, they were also the group to endure the biggest losses as the stock fell by 11%.

In the chart below, we zoom in on the different ownership groups of Dashan Education Holdings.

See our latest analysis for Dashan Education Holdings

What Does The Lack Of Institutional Ownership Tell Us About Dashan Education Holdings?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

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. Dashan Education Holdings might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

Hedge funds don't have many shares in Dashan Education Holdings. Hongjun Zhang is currently the largest shareholder, with 34% of shares outstanding. Meanwhile, the second largest shareholder is Xi Wang holding 27%.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 61% stake.

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 Dashan Education Holdings

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.

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 Dashan Education Holdings Limited stock. This gives them a lot of power. That means they own HK$973m worth of shares in the HK$1.6b 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

The general public-- including retail investors -- own 39% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Dashan Education Holdings better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Dashan Education Holdings you should be aware of, and 1 of them is concerning.

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.