AsiaInfo Technologies Limited's (HKG:1675) market cap surged HK$412m last week, individual investors who have a lot riding on the company were rewarded

Key Insights

• The considerable ownership by individual investors in AsiaInfo Technologies indicates that they collectively have a greater say in management and business strategy
• A total of 4 investors have a majority stake in the company with 56% ownership
• Insiders have been selling lately

If you want to know who really controls AsiaInfo Technologies Limited (HKG:1675), then you'll have to look at the makeup of its share registry. With 27% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, individual investors benefitted the most after the company's market cap rose by HK$412m last week.

Let's delve deeper into each type of owner of AsiaInfo Technologies, beginning with the chart below.

View our latest analysis for AsiaInfo Technologies

What Does The Institutional Ownership Tell Us About AsiaInfo Technologies?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

AsiaInfo Technologies already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 AsiaInfo Technologies' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in AsiaInfo Technologies. Asiainfo Security Technologies Co.,Ltd. is currently the largest shareholder, with 20% of shares outstanding. In comparison, the second and third largest shareholders hold about 19% and 9.6% of the stock. Suning Tian, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. In addition, we found that Nianshu Gao, the CEO has 2.4% of the shares allocated to their name.

Our research also brought to light the fact that roughly 56% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of AsiaInfo Technologies

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.

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.

It seems insiders own a significant proportion of AsiaInfo Technologies Limited. It has a market capitalization of just HK$5.7b, and insiders have HK$967m worth of shares in their own names. 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 27% 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 Company Ownership

It seems that Private Companies own 19%, of the AsiaInfo Technologies stock. 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.

Public Company Ownership

Public companies currently own 20% of AsiaInfo Technologies 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 4 warning signs for AsiaInfo Technologies (1 doesn't sit too well with us) that you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.