Haizhuan Lu AuGroup (SHENZHEN) Cross-Border Business Co., Ltd.'s (HKG:2519) CEO is the most bullish insider, and their stock value gained 11%last week

Key Insights

• AuGroup (SHENZHEN) Cross-Border Business' significant insider ownership suggests inherent interests in company's expansion
• 50% of the business is held by the top 6 shareholders
• Institutions own 17% of AuGroup (SHENZHEN) Cross-Border Business

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To get a sense of who is truly in control of AuGroup (SHENZHEN) Cross-Border Business Co., Ltd. (HKG:2519), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 47% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders were the biggest beneficiaries of last week’s 11% gain.

Let's take a closer look to see what the different types of shareholders can tell us about AuGroup (SHENZHEN) Cross-Border Business.

View our latest analysis for AuGroup (SHENZHEN) Cross-Border Business

What Does The Institutional Ownership Tell Us About AuGroup (SHENZHEN) Cross-Border Business?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that AuGroup (SHENZHEN) Cross-Border Business does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at AuGroup (SHENZHEN) Cross-Border Business' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in AuGroup (SHENZHEN) Cross-Border Business. With a 17% stake, CEO Haizhuan Lu is the largest shareholder. Kuaiyue Ze is the second largest shareholder owning 10% of common stock, and Shenzhen Capital Group Co., Ltd. holds about 8.3% of the company stock. Interestingly, the second-largest shareholder, Kuaiyue Ze is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

We also observed that the top 6 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. 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 AuGroup (SHENZHEN) Cross-Border Business

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own a reasonable proportion of AuGroup (SHENZHEN) Cross-Border Business Co., Ltd.. Insiders have a HK$1.5b stake in this HK$3.1b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 14% stake in the company, and hence can't easily be ignored. 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.

Private Equity Ownership

With a stake of 15%, private equity firms could influence the AuGroup (SHENZHEN) Cross-Border Business board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 5.9%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand AuGroup (SHENZHEN) Cross-Border Business better, we need to consider many other factors. For instance, we've identified 1 warning sign for AuGroup (SHENZHEN) Cross-Border Business that you should be aware of.

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.