The recent HK$493m market cap decrease is likely to have disappointed insiders invested in Hopson Development Holdings Limited (HKG:754)

Key Insights

• Significant insider control over Hopson Development Holdings implies vested interests in company growth
• Mang Yee Chu owns 54% of the company
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

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If you want to know who really controls Hopson Development Holdings Limited (HKG:754), 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 74% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, insiders endured the biggest losses as the stock fell by 4.1%.

In the chart below, we zoom in on the different ownership groups of Hopson Development Holdings.

View our latest analysis for Hopson Development Holdings

What Does The Institutional Ownership Tell Us About Hopson Development Holdings?

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.

Institutions have a very small stake in Hopson Development Holdings. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hedge funds don't have many shares in Hopson Development Holdings. The company's largest shareholder is Mang Yee Chu, with ownership of 54%. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 18% of the shares outstanding, followed by an ownership of 1.6% by the third-largest shareholder. Wai Kin Au, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

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 Hopson Development Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our most recent data indicates that insiders own the majority of Hopson Development Holdings Limited. This means they can collectively make decisions for the company. Given it has a market cap of HK$12b, that means insiders have a whopping HK$8.6b worth of shares in their own names. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

With a 23% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hopson Development Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Hopson Development Holdings you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.