A look at the shareholders of Gome Finance Technology Co., Ltd. (HKG: 628) can tell us which group is more powerful. Big companies usually have institutions as shareholders, and we usually see insiders owning shares in small companies. Warren Buffett said he likes “a business with enduring competitive advantages that is led by capable, owner-oriented people.” So it’s nice to see some insider ownership, as it may suggest management is owner-driven.
Gome Finance Technology is not a big company by global standards. It has a market cap of HK$945 million, which means it wouldn’t get the attention of many institutional investors. Our analysis of company ownership, below, shows that the institutions are not listed on the share register. We can zoom in on the different ownership groups, to learn more about Gome Finance Technology.
Check out our latest analysis for Gome Finance Technology
What does the lack of institutional ownership tell us about the Gome Finance technology?
Small companies that are not very actively traded often lack institutional investors, but it is less common to see large companies without them.
There are many reasons why a company may not have institutions listed in the share register. It can be difficult for institutions to buy large amounts of shares if liquidity (the amount of shares traded each day) is low. If the company did not need to raise capital, institutions might not have the opportunity to build a position. On the other hand, it’s always possible for professional investors to avoid a company because they think it’s not the best place for their money. Gome Finance Technology may not have the kind of track record that institutions seek, or perhaps they just haven’t studied the company closely.
Hedge funds don’t have a lot of shares in Gome Finance Technology. The company’s largest shareholder is Juan Du, with a 61% stake. With such a stake in ownership, we infer that they have significant control over the future of the business. With a 13% stake, the second largest shareholder is Chun-Shun Ko
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. Our information suggests there is no analyst coverage of the stock, so it is likely little known.
Owned by Gome Finance Technology Insiders
The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.
It appears that insiders own more than half of the shares of Gome Finance Technology Co., Ltd. It gives them a lot of power. That means they own HK$697 million worth of shares in the HK$945 million company. It is quite significant. Most would be delighted to see the board investing alongside them. You might want to find out (free) whether they bought or sold.
General public property
The general public, including retail investors, owns 26% of the company’s capital and therefore cannot be easily ignored. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. For example, we have identified 2 warning signs for Gome Finance Technology (I’m not very good with us) that you should be aware of.
If you’d rather check out another company – one with potentially superior finances – then don’t miss this free list of interesting companies, supported by solid financial data.
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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