Key Insights
- Significant control over Shandong Weigao Group Medical Polymer by private companies implies that the general public has more power to influence management and governance-related decisions
- 51% of the business is held by the top 2 shareholders
- 31% of Shandong Weigao Group Medical Polymer is held by Institutions
A look at the shareholders of Shandong Weigao Group Medical Polymer Company Limited (HKG:1066) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 46% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
While the holdings of private companies took a hit after last week’s 4.2% price drop, institutions with their 31% holdings also suffered.
Let's take a closer look to see what the different types of shareholders can tell us about Shandong Weigao Group Medical Polymer.
Check out our latest analysis for Shandong Weigao Group Medical Polymer
What Does The Institutional Ownership Tell Us About Shandong Weigao Group Medical Polymer?
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.
Shandong Weigao Group Medical Polymer already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Shandong Weigao Group Medical Polymer, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Shandong Weigao Group Medical Polymer. Weihai Weigao International Medical Investment Holdings Limited is currently the company's largest shareholder with 46% of shares outstanding. Wellington Management Group LLP is the second largest shareholder owning 4.9% of common stock, and Norges Bank Investment Management holds about 3.2% of the company stock.
To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Shandong Weigao Group Medical Polymer
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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that Shandong Weigao Group Medical Polymer Company Limited insiders own under 1% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own HK$52m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.
General Public Ownership
The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
We can see that Private Companies own 46%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Shandong Weigao Group Medical Polymer is showing 1 warning sign in our investment analysis , you should know about...
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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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.