What Is The Ownership Structure Like For Cheetah Mobile Inc. (NYSE:CMCM)?

Every investor in Cheetah Mobile Inc. (NYSE:CMCM) should be aware of the most powerful shareholder groups. 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.

Cheetah Mobile is not a large company by global standards. It has a market capitalization of US$334m, which means it wouldn't have the attention of many institutional investors. In the chart below, we can see that institutions are not really that prevalent on the share registry. We can zoom in on the different ownership groups, to learn more about Cheetah Mobile.

See our latest analysis for Cheetah Mobile

What Does The Institutional Ownership Tell Us About Cheetah Mobile?

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 Cheetah Mobile. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. 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.

We note that hedge funds don't have a meaningful investment in Cheetah Mobile. Looking at our data, we can see that the largest shareholder is Kingsoft Corporation Limited with 48% of shares outstanding. For context, the second largest shareholder holds about 17% of the shares outstanding, followed by an ownership of 5.2% by the third-largest shareholder. Sheng Fu, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 65% stake.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Cheetah Mobile

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 Cheetah Mobile Inc.. In their own names, insiders own US$17m worth of stock in the US$334m 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, with a 25% stake in the company, will not easily be ignored. 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.

Public Company Ownership

Public companies currently own 65% of Cheetah Mobile stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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. To that end, you should be aware of the 1 warning sign we've spotted with Cheetah Mobile .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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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