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Yonghui Superstores Co., Ltd.'s (SHSE:601933) Last Week's 3.2% Decline Must Have Disappointed Individual Investors Who Have a Significant Stake

Simply Wall St ·  Jan 10 07:15

Key Insights

  • Yonghui Superstores' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
  • A total of 4 investors have a majority stake in the company with 51% ownership
  • 16% of Yonghui Superstores is held by insiders

Every investor in Yonghui Superstores Co., Ltd. (SHSE:601933) should be aware of the most powerful shareholder groups. With 39% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, individual investors endured the biggest losses as the stock fell by 3.2%.

Let's delve deeper into each type of owner of Yonghui Superstores, beginning with the chart below.

Check out our latest analysis for Yonghui Superstores

ownership-breakdown
SHSE:601933 Ownership Breakdown January 9th 2024

What Does The Institutional Ownership Tell Us About Yonghui Superstores?

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.

Since institutions own only a small portion of Yonghui Superstores, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

earnings-and-revenue-growth
SHSE:601933 Earnings and Revenue Growth January 9th 2024

Hedge funds don't have many shares in Yonghui Superstores. Jardine Matheson Holdings Limited is currently the company's largest shareholder with 21% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 14% and 8.9%, of the shares outstanding, respectively. Xuan-Song Zhang, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. 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 Yonghui Superstores

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Yonghui Superstores Co., Ltd.. Insiders own CN¥3.9b worth of shares in the CN¥24b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 39% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 5.4%, of the Yonghui Superstores stock. 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.

Public Company Ownership

We can see that public companies hold 35% of the Yonghui Superstores shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Yonghui Superstores better, we need to consider many other factors.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.

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