Do insiders own a lot of shares in CK Hutchison Holdings Limited (HKG:1)?

The large shareholder groups of CK Hutchison Holdings Limited (HKG:1) have power over the company. Insiders often own a large portion of younger, smaller companies, while larger companies tend to have institutions as shareholders. I like to see at least a little insider ownership. As Charlie Munger said “Show me the incentive and I’ll show you the result”.

CK Hutchison Holdings has a market cap of HK$204 billion, so it’s too big to fly under the radar. We expect institutions and retail investors to own part of the business. In the graph below, we can see that the institutions own shares in the company. Let’s dig deeper into each type of owner to learn more about CK Hutchison Holdings.

Check out our latest analysis for CK Hutchison Holdings

SEHK: 1 Ownership Breakdown July 6, 2022

What does institutional ownership tell us about CK Hutchison Holdings?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.

We can see that CK Hutchison Holdings has institutional investors; and they own a good part of the shares of the company. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it is worth checking out the earnings history of CK Hutchison Holdings below. Of course, the future is what really matters.

SEHK: 1 Profit and Revenue Growth July 6, 2022

CK Hutchison Holdings is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders hold a significant stake in a company. In the case of CK Hutchison Holdings, its top executive, Ka-shing Li, is the largest shareholder, owning 29% of the outstanding shares. BlackRock, Inc. is the second-largest shareholder with 4.9% of common stock and The Vanguard Group, Inc. owns approximately 2.6% of the company’s stock.

Our studies suggest that the top 25 shareholders collectively control less than half of the company’s shares, which means that the company’s shares are widely distributed and there is no dominant shareholder.

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. A number of analysts cover the stock, so you can look at growth forecasts quite easily.

Insider ownership of CK Hutchison Holdings

The definition of an insider may differ slightly from country to country, but board members still matter. The management of the company answers to the board of directors and the latter must represent the interests of the shareholders. In particular, sometimes the senior executives themselves sit on the board of directors.

Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.

Our most recent data indicates that insiders own a reasonable proportion of CK Hutchison Holdings Limited. Its market capitalization is only HK$204 billion and insiders hold HK$59 billion worth of shares in their own name. It is quite significant. Good to see this level of investment. You can check here if these insiders have bought recently.

General public property

The general public, including retail investors, owns 49% of the company’s shares and therefore cannot be easily ignored. This size of ownership, although considerable, may not be sufficient to change company policy if the decision is not in line with other major shareholders.

Next steps:

It is always useful to think about the different groups that own shares in a company. But to better understand CK Hutchison Holdings, we need to consider many other factors. Take risks for example – CK Hutchison Holdings has 2 warning signs we think 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.

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.

About Catherine Wilson

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