Is Hevol Services Group Co. Limited (HKG:6093) Popular Amongst Insiders?

By
Simply Wall St
Published
May 31, 2021
SEHK:6093
Source: Shutterstock

The big shareholder groups in Hevol Services Group Co. Limited (HKG:6093) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

Hevol Services Group is not a large company by global standards. It has a market capitalization of HK$2.2b, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have not yet purchased shares. Let's delve deeper into each type of owner, to discover more about Hevol Services Group.

See our latest analysis for Hevol Services Group

ownership-breakdown
SEHK:6093 Ownership Breakdown June 1st 2021

What Does The Lack Of Institutional Ownership Tell Us About Hevol Services Group?

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 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. 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 Hevol Services Group, for yourself, below.

earnings-and-revenue-growth
SEHK:6093 Earnings and Revenue Growth June 1st 2021

We note that hedge funds don't have a meaningful investment in Hevol Services Group. Our data shows that Jiang Liu is the largest shareholder with 51% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Hevol Services Group

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

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.

Our most recent data indicates that insiders own the majority of Hevol Services Group Co. Limited. This means they can collectively make decisions for the company. So they have a HK$1.1b stake in this HK$2.2b business. 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, with a 49% stake in the company, will not easily be ignored. 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.

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. For example, we've discovered 2 warning signs for Hevol Services Group that you should be aware of before investing here.

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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