CanSino Biologics Inc.'s (HKG:6185) last week's 4.5% decline must have disappointed individual investors who have a significant stake

Key Insights

• The considerable ownership by individual investors in CanSino Biologics indicates that they collectively have a greater say in management and business strategy
• 41% of the business is held by the top 25 shareholders
• Insider ownership in CanSino Biologics is 31%

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A look at the shareholders of CanSino Biologics Inc. (HKG:6185) can tell us which group is most powerful. The group holding the most number of shares in the company, around 58% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of individual investors took a hit after last week’s 4.5% price drop, insiders with their 31% also suffered.

In the chart below, we zoom in on the different ownership groups of CanSino Biologics.

View our latest analysis for CanSino Biologics

What Does The Institutional Ownership Tell Us About CanSino Biologics?

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.

CanSino Biologics already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of CanSino Biologics, (below). Of course, keep in mind that there are other factors to consider, too.

CanSino Biologics is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Huihua Mao with 9.5% of shares outstanding. The second and third largest shareholders are Tao Zhu and Xuefeng Yu, with an equal amount of shares to their name at 7.3%. Note that the second and third-largest shareholders are also Top Key Executive and Chairman of the Board, respectively, meaning that the company's top shareholders are insiders.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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

Insider Ownership Of CanSino Biologics

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.

It seems insiders own a significant proportion of CanSino Biologics Inc.. Insiders own HK$4.0b worth of shares in the HK$13b company. That's quite meaningful. 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 -- including retail investors -- own 58% of CanSino Biologics. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

It seems that Private Companies own 4.2%, of the CanSino Biologics stock. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.