Posted on May 29, 2023
- Significant control over COSCO SHIPPING Ports by public companies implies that the general public has more power to influence management and governance-related decisions
- COSCO SHIPPING Holdings Co., Ltd. owns 60% of the company
- 23% of COSCO SHIPPING Ports is held by Institutions
To get a sense of who is truly in control of COSCO SHIPPING Ports Limited (HKG:1199), it is important to understand the ownership structure of the business. We can see that public companies own the lion’s share in the company with 60% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
While institutions who own 23% came under pressure after market cap dropped to HK$18b last week,public companies took the most losses.
Let’s take a closer look to see what the different types of shareholders can tell us about COSCO SHIPPING Ports.
Ownership Breakdown May 24th 2023
What Does The Institutional Ownership Tell Us About COSCO SHIPPING Ports?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that COSCO SHIPPING Ports does have institutional investors; and they hold a good portion of the company’s stock. This suggests some credibility amongst professional investors. But we can’t rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 COSCO SHIPPING Ports’ earnings history below. Of course, the future is what really matters.
Earnings and Revenue Growth May 24th 2023
COSCO SHIPPING Ports is not owned by hedge funds. Our data shows that COSCO SHIPPING Holdings Co., Ltd. is the largest shareholder with 60% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Meanwhile, the second and third largest shareholders, hold 8.0% and 2.4%, of the shares outstanding, respectively.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of COSCO SHIPPING Ports
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
Our most recent data indicates that insiders own less than 1% of COSCO SHIPPING Ports Limited. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around HK$7.4m worth of shares (at current prices). It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General Public Ownership
With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over COSCO SHIPPING Ports. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Public Company Ownership
We can see that public companies hold 60% of the COSCO SHIPPING Ports shares on issue. 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.
