Key Insights
- Significant control over AsiaInfo Technologies by retail investors implies that the general public has more power to influence management and governance-related decisions
- The top 4 shareholders own 56% of the company
- 12% of AsiaInfo Technologies is held by insiders
If you want to know who really controls AsiaInfo Technologies Limited (HKG:1675), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are retail investors with 32% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
As a result, retail investors collectively scored the highest last week as the company hit HK$9.9b market cap following a 16% gain in the stock.
Let's take a closer look to see what the different types of shareholders can tell us about AsiaInfo Technologies.
View our latest analysis for AsiaInfo Technologies
What Does The Institutional Ownership Tell Us About AsiaInfo Technologies?
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.
We can see that AsiaInfo Technologies does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at AsiaInfo Technologies' earnings history below. Of course, the future is what really matters.
Hedge funds don't have many shares in AsiaInfo Technologies. The company's largest shareholder is Asiainfo Security Technologies Co.,Ltd., with ownership of 20%. For context, the second largest shareholder holds about 19% of the shares outstanding, followed by an ownership of 9.6% by the third-largest shareholder. Suning Tian, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. In addition, we found that Nianshu Gao, the CEO has 2.4% of the shares allocated to their name.
Our research also brought to light the fact that roughly 56% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.
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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
Insider Ownership Of AsiaInfo Technologies
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 insiders maintain a significant holding in AsiaInfo Technologies Limited. It is very interesting to see that insiders have a meaningful HK$1.2b stake in this HK$9.9b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public, who are usually individual investors, hold a 32% stake in AsiaInfo Technologies. 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
Our data indicates that Private Companies hold 19%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Public Company Ownership
Public companies currently own 20% of AsiaInfo Technologies stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.
Next Steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - AsiaInfo Technologies has 2 warning signs we think you should be aware of.
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.