A look at the shareholders of Goldin Financial Holdings Limited (HKG:530) 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 generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.
With a market capitalization of HK$8.7b, Goldin Financial Holdings is a decent size, so it is probably on the radar of institutional investors. Our analysis of the ownership of the company, below, shows that institutions are not on the share registry. Let’s take a closer look to see what the different types of shareholder can tell us about Goldin Financial Holdings.
What Does The Lack Of Institutional Ownership Tell Us About Goldin Financial 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 many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. It is also possible that fund managers don’t own the stock because they aren’t convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Goldin Financial Holdings, for yourself, below.
We note that hedge funds don’t have a meaningful investment in Goldin Financial Holdings. Our data suggests that Sutong Pan, who is also the company’s Top Key Executive, holds the most number of shares at 68%. 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. The second and third largest shareholders are Goldin Real Estate Financial Holdings Limited and Northern Trust Global Investments, holding 2.7% and 0.02%, respectively.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock’s expected performance. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Goldin Financial 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. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
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 Goldin Financial Holdings Limited stock. This gives them a lot of power. Insiders own HK$6.0b worth of shares in the HK$8.7b company. That’s extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.
General Public Ownership
The general public holds a 29% stake in 530. 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.
It’s always worth thinking about the different groups who own shares in a company. But to understand Goldin Financial Holdings better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we’ve spotted with Goldin Financial Holdings (including 1 which is can’t be ignored) .
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.
When trading Goldin Financial Holdings or any other investment, use the platform considered by many to be the Professional’s Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.
This article by Simply Wall St is general in nature. 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email email@example.com.