Jinhui Shipping and Transportation Limited's (OB:JIN) market cap dropped kr177m last week; Public companies bore the brunt

Published
June 27, 2022
OB:JIN
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Every investor in Jinhui Shipping and Transportation Limited (OB:JIN) should be aware of the most powerful shareholder groups. With 56% stake, public companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 12% decline in share price, public companies suffered the most losses.

Let's delve deeper into each type of owner of Jinhui Shipping and Transportation, beginning with the chart below.

View our latest analysis for Jinhui Shipping and Transportation

ownership-breakdown
OB:JIN Ownership Breakdown June 27th 2022

What Does The Lack Of Institutional Ownership Tell Us About Jinhui Shipping and Transportation?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

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. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. 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 Jinhui Shipping and Transportation, for yourself, below.

earnings-and-revenue-growth
OB:JIN Earnings and Revenue Growth June 27th 2022

Jinhui Shipping and Transportation is not owned by hedge funds. Jinhui Holdings Company Limited is currently the largest shareholder, with 56% of shares outstanding. This implies that they have majority interest control of the future of the company. Siu Fai Ng is the second largest shareholder owning 4.8% of common stock, and Kam Wah Ng holds about 1.0% of the company stock. Note that the second and third-largest shareholders are also Top Key Executive and Vice Chairman, respectively, meaning that the company's top shareholders are insiders.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Jinhui Shipping and Transportation

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.

Shareholders would probably be interested to learn that insiders own shares in Jinhui Shipping and Transportation Limited. In their own names, insiders own kr72m worth of stock in the kr1.2b company. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

With a 38% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Jinhui Shipping and Transportation. 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.

Public Company Ownership

It appears to us that public companies own 56% of Jinhui Shipping and Transportation. 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 3 warning signs for Jinhui Shipping and Transportation (1 is concerning) that you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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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