Following recent decline, iHuman Inc.'s (NYSE:IH) top shareholder Top Key Executive Yufeng Chi sees holdings value drop by 12%

Key Insights

• Significant insider control over iHuman implies vested interests in company growth
• Yufeng Chi owns 56% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

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Every investor in iHuman Inc. (NYSE:IH) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 72% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders as a group endured the highest losses after market cap fell by US$17m.

In the chart below, we zoom in on the different ownership groups of iHuman.

See our latest analysis for iHuman

What Does The Lack Of Institutional Ownership Tell Us About iHuman?

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 multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. 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 iHuman, for yourself, below.

Hedge funds don't have many shares in iHuman. From our data, we infer that the largest shareholder is Yufeng Chi (who also holds the title of Top Key Executive) with 56% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. The second and third largest shareholders are Peng Dai and Liang Tian, with an equal amount of shares to their name at 6.2%. Interestingly, the second-largest shareholder, Peng Dai is also Chief Executive Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of iHuman

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.

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.

It seems that insiders own more than half the iHuman Inc. stock. This gives them a lot of power. That means they own US$94m worth of shares in the US$131m company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 28% stake in iHuman. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand iHuman better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.