Private companies in CN Logistics International Holdings Limited (HKG:2130) are its biggest bettors, and their bets paid off as stock gained 16% last week

Key Insights

• Significant control over CN Logistics International Holdings by private companies implies that the general public has more power to influence management and governance-related decisions
• 53% of the company is held by a single shareholder (Hundred Honest Limited)
• 19% of CN Logistics International Holdings is held by insiders

A look at the shareholders of CN Logistics International Holdings Limited (HKG:2130) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 58% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private companies collectively scored the highest last week as the company hit HK$1.1b market cap following a 16% gain in the stock.

In the chart below, we zoom in on the different ownership groups of CN Logistics International Holdings.

Check out our latest analysis for CN Logistics International Holdings

What Does The Lack Of Institutional Ownership Tell Us About CN Logistics International 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 are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. CN Logistics International 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.

We note that hedge funds don't have a meaningful investment in CN Logistics International Holdings. The company's largest shareholder is Hundred Honest Limited, with ownership of 53%. This implies that they have majority interest control of the future of the company. Tim Wing Ngan is the second largest shareholder owning 7.1% of common stock, and CS Logistics Holdings Limited holds about 5.1% of the company stock. Tim Wing Ngan, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of CN Logistics International Holdings

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.

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 a reasonable proportion of CN Logistics International Holdings Limited. It has a market capitalization of just HK$1.1b, and insiders have HK$209m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

With a 23% ownership, the general public, mostly comprising of individual investors, have some degree of sway over CN Logistics International 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.

Private Company Ownership

We can see that Private Companies own 58%, of the shares on issue. 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 CN Logistics International Holdings better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for CN Logistics International Holdings you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.