Powerlong Commercial Management Holdings Limited's (HKG:9909) market cap surged HK$219m last week, public companies who have a lot riding on the company were rewarded

Key Insights

• The considerable ownership by public companies in Powerlong Commercial Management Holdings indicates that they collectively have a greater say in management and business strategy
• 63% of the company is held by a single shareholder (Powerlong Real Estate Holdings Limited)
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Powerlong Commercial Management Holdings Limited (HKG:9909) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are public companies with 63% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, public companies benefitted the most after the company's market cap rose by HK$219m last week.

Let's delve deeper into each type of owner of Powerlong Commercial Management Holdings, beginning with the chart below.

See our latest analysis for Powerlong Commercial Management Holdings

What Does The Lack Of Institutional Ownership Tell Us About Powerlong Commercial Management Holdings?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

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. Powerlong Commercial Management Holdings' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

Hedge funds don't have many shares in Powerlong Commercial Management Holdings. Our data shows that Powerlong Real Estate Holdings Limited is the largest shareholder with 63% of shares outstanding. This implies that they have majority interest control of the future of the company. In comparison, the second and third largest shareholders hold about 3.9% and 2.7% of the stock. Note that the second and third-largest shareholders are also Co-Chief Executive Officer and Member of the Board of Directors, respectively, meaning that the company's top shareholders are insiders.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Powerlong Commercial Management Holdings

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

We can see that insiders own shares in Powerlong Commercial Management Holdings Limited. As individuals, the insiders collectively own HK$109m worth of the HK$1.6b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 30% stake in Powerlong Commercial Management Holdings. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Public Company Ownership

Public companies currently own 63% of Powerlong Commercial Management Holdings stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

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.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.