Mercuries & Associates Holding, Ltd.'s (TWSE:2905) market cap surged NT$1.9b last week, private companies who have a lot riding on the company were rewarded

Key Insights

• The considerable ownership by private companies in Mercuries & Associates Holding indicates that they collectively have a greater say in management and business strategy
• The top 5 shareholders own 54% of the company
• Insider ownership in Mercuries & Associates Holding is 11%

Every investor in Mercuries & Associates Holding, Ltd. (TWSE:2905) should be aware of the most powerful shareholder groups. With 54% stake, private companies possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, private companies collectively scored the highest last week as the company hit NT$20b market cap following a 11% gain in the stock.

Let's delve deeper into each type of owner of Mercuries & Associates Holding, beginning with the chart below.

Check out 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.

Institutions have a very small stake in Mercuries & Associates Holding. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Mercuries & Associates Holding is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Nanlin Investment Co., Ltd. with 19% of shares outstanding. In comparison, the second and third largest shareholders hold about 14% and 11% of the stock. Additionally, the company's CEO Shiang-Li Chen directly holds 2.4% of the total shares outstanding.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

It seems insiders own a significant proportion of Mercuries & Associates Holding, Ltd.. Insiders have a NT$2.3b stake in this NT$20b business. 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 28% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Mercuries & Associates Holding. 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.

Private Company Ownership

It seems that Private Companies own 54%, of the Mercuries & Associates Holding stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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 3 warning signs for Mercuries & Associates Holding (1 makes us a bit uncomfortable) 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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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.

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