Is Mercuries & Associates Holding, Ltd. (TPE:2905) Popular Amongst Insiders?

A look at the shareholders of Mercuries & Associates Holding, Ltd. (TPE:2905) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

With a market capitalization of NT$18b, Mercuries & Associates Holding is a small cap stock, so it might not be well known by many institutional investors. In the chart below, we can see that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Mercuries & Associates Holding.

See our latest analysis for Mercuries & Associates Holding

What Does The Institutional Ownership Tell Us About Mercuries & Associates Holding?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Mercuries & Associates Holding does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Mercuries & Associates Holding's earnings history below. Of course, the future is what really matters.

Mercuries & Associates Holding is not owned by hedge funds. Nanlin Investment Co., Ltd. is currently the largest shareholder, with 22% of shares outstanding. In comparison, the second and third largest shareholders hold about 15% and 2.9% of the stock. Shiang-Li Chen, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

We also observed that the top 10 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. 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 Mercuries & Associates Holding

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.

I can report that insiders do own shares in Mercuries & Associates Holding, Ltd.. As individuals, the insiders collectively own NT$1.5b worth of the NT$18b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public holds a 49% stake in Mercuries & Associates Holding. 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 37%, of the Mercuries & Associates Holding 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Mercuries & Associates Holding better, we need to consider many other factors. For example, we've discovered 3 warning signs for Mercuries & Associates Holding that you should be aware of before investing here.

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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