Following a 40% decline over last year, recent gains may please Goodwill E-Health Info Co., Ltd. (SHSE:688246) institutional owners

Simply Wall St · 09/29 00:33

Key Insights

  • Significantly high institutional ownership implies Goodwill E-Health Info's stock price is sensitive to their trading actions
  • A total of 5 investors have a majority stake in the company with 54% ownership
  • Insiders own 20% of Goodwill E-Health Info

Every investor in Goodwill E-Health Info Co., Ltd. (SHSE:688246) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are institutions with 34% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Last week's CN¥400m market cap gain would probably be appreciated by institutional investors, especially after a year of 40% losses.

Let's take a closer look to see what the different types of shareholders can tell us about Goodwill E-Health Info.

Check out our latest analysis for Goodwill E-Health Info

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SHSE:688246 Ownership Breakdown September 29th 2024

What Does The Institutional Ownership Tell Us About Goodwill E-Health Info?

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 Goodwill E-Health Info 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Goodwill E-Health Info's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth
SHSE:688246 Earnings and Revenue Growth September 29th 2024

We note that hedge funds don't have a meaningful investment in Goodwill E-Health Info. With a 18% stake, CEO Jun Xia is the largest shareholder. China Life Private Equity Investment Co., Ltd. is the second largest shareholder owning 12% of common stock, and Alibaba Health Information Technology Limited holds about 8.5% of the company stock.

On looking further, we found that 54% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Goodwill E-Health Info

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. 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.

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.

It seems insiders own a significant proportion of Goodwill E-Health Info Co., Ltd.. Insiders own CN¥529m worth of shares in the CN¥2.6b company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 15% stake in Goodwill E-Health Info. 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 Equity Ownership

With an ownership of 12%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 10%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Public Company Ownership

Public companies currently own 8.5% of Goodwill E-Health Info 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Goodwill E-Health Info better, we need to consider many other factors. Take risks for example - Goodwill E-Health Info has 2 warning signs we think you should be aware of.

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.