To get an idea of who actually controls Differ Group Holding Company Limited (HKG:6878), it is important to understand the ownership structure of the company. And the group that holds the biggest slice of the pie are individual insiders with 58% ownership. In other words, the group faces the maximum upside potential (or downside risk).
And last week, insiders suffered the biggest losses, as the stock fell 11%.
Let’s take a closer look at what different types of shareholders can tell us about Differ Group Holding.
Discover our latest analysis for Differ Group Holding
What does institutional ownership tell us about Differ Group 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.
Differ Group Holding already has institutions registered in the share register. Indeed, they hold a respectable stake in the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Differ Group Holding’s historical earnings and revenue below, but keep in mind there’s always more to tell.
Hedge funds do not have many shares in Differ Group Holding. Mingxian Hong is currently the largest shareholder, with 42% of the outstanding shares. With 16% and 7.2% of the shares outstanding, respectively, Chi Chung Ng and AssetMark, Inc. are the second and third largest shareholders. Chi Chung Ng, who is the second largest shareholder, also holds the title of general manager.
A more detailed study of the shareholder register showed us that 2 of the main shareholders hold a considerable stake in the company, via their 58% stake.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand a stock’s expected performance. There is a little analyst coverage of the stock, but not much. So there is room for him to gain coverage.
Insider ownership of Differ Group Holding
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.
Insider ownership is positive when it signals that executives think like the true owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
It appears that insiders own more than half of the shares of Differ Group Holding Company Limited. It gives them a lot of power. Given that it has a market capitalization of HK$15 billion, that means insiders have a whopping HK$8.5 billion worth of shares in their own name. Most would say this is a positive, showing strong alignment with shareholders. You can click here to see if they have sold their stake.
General public property
The general public, who are usually individual investors, hold a 32% stake in Differ Group Holding. While this size of ownership may not be enough to sway a policy decision in their favor, they can still have a collective impact on company policies.
While it is worth considering the different groups that own a business, there are other, even more important factors. Consider the risks, for example. Every business has them, and we’ve spotted 2 warning signs for Differ Group Holding you should know.
If you prefer to find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.