MTR Corporation Limited's (HKG:66) largest shareholders are state or government with 74% ownership, individual investors own 20%

Key Insights

• Significant control over MTR by state or government implies that the general public has more power to influence management and governance-related decisions
• 74% of the company is held by a single shareholder (Hong Kong)
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

If you want to know who really controls MTR Corporation Limited (HKG:66), then you'll have to look at the makeup of its share registry. We can see that state or government own the lion's share in the company with 74% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors, on the other hand, account for 20% of the company's stockholders.

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

View our latest analysis for MTR

What Does The Institutional Ownership Tell Us About MTR?

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.

MTR already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see MTR's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in MTR. Hong Kong is currently the company's largest shareholder with 74% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. With 1.1% and 1.1% of the shares outstanding respectively, BlackRock, Inc. and The Vanguard Group, Inc. are the second and third largest shareholders.

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 MTR

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.

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.

Our data suggests that insiders own under 1% of MTR Corporation Limited in their own names. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own HK$87m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 20% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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 instance, we've identified 2 warning signs for MTR (1 doesn't sit too well with us) that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.