What percentage of Lenovo Group Limited (HKG: 992) shares do insiders own?


The large shareholder groups of Lenovo Group Limited (HKG: 992) have power over the company. Institutions often own shares in larger companies, and we would expect insiders to own a noticeable percentage of smaller ones. Warren Buffett said he enjoys “a business with sustainable competitive advantages that is led by skilled, owner-oriented people.” So it’s nice to see some insider ownership as it can suggest that the management is owner-driven.

The Lenovo Group has a market cap of HK $ 108 billion, so it is too big to go unnoticed. We expect institutions and retail investors to own a portion of the company. In the graph below, we can see that the institutions hold shares in the company. We can zoom in on the different ownership groups, to find out more about Lenovo Group.

Check out our latest review for the Lenovo group

SEHK: 992 Distribution of ownership June 21, 2021

What does institutional ownership tell us about the Lenovo group?

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 businesses to have some institutions listed, especially if they are growing.

As you can see, institutional investors own a large share of the Lenovo group. This implies that analysts working for these institutions have reviewed the action and appreciate it. But like everyone else, they could be wrong. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell stocks quickly. This risk is higher in a company without a history of growth. You can see the historical earnings and revenue of the Lenovo Group below, but keep in mind that there is always more to tell.

profit and revenue growth
SEHK: 992 Revenue and Revenue Growth June 21, 2021

The Lenovo group does not belong to hedge funds. Our data shows that Legend Holdings Corporation is the largest shareholder with 24% of the shares outstanding. For context, the second largest shareholder owns around 7.2% of the outstanding shares, followed by a 6.4% stake by the third largest shareholder. In addition, the company’s CEO, Yuanqing Yang, directly owns 6.2% of the total outstanding shares.

We also observed that the top 6 shareholders make up more than half of the share register, with a few smaller shareholders to some extent to balance the interests of the larger ones.

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 the expected performance of a stock. Many analysts cover the stock, so it can be interesting to see what they are forecasting as well.

Lenovo Group Insider Ownership

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management ultimately reports to the board of directors. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.

Most view insider ownership as a positive, as it can indicate that the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Shareholders would likely be interested to learn that insiders own shares of Lenovo Group Limited. It is a very large company and the members of the board collectively own HK $ 6.8 billion in shares (at current prices). It’s good to see this level of investment. You can check here if these insiders have bought recently.

General public property

With a 34% stake, the general public has some influence over Lenovo Group. While this property size may not be enough to influence a policy decision in their favor, they can still have a collective impact on company policies.

Owned by a private company

It seems that private companies own 6.4% of the shares of the Lenovo group. Private companies can be related parties. Sometimes insiders have an interest in a public company through a stake in a private company, rather than in their own capacity as an individual. While it is difficult to draw general conclusions, it is worth noting as an area for further research.

Public enterprise ownership

It seems to us that state-owned companies own 24% of Lenovo Group. We cannot be sure, but it is quite possible that it is a strategic issue. Companies can be similar or work together.

Next steps:

While it is worth considering the different groups that own a business, there are other factors that are even more important. For example, we have identified 2 warning signs for the Lenovo group that you should be aware of.

But finally it’s the future, not the past, which will determine how well the owners of this business fare. Therefore, we believe it is advisable to take a look at this free report showing whether analysts are predicting a better future.

NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.

Promoted
If you are looking to trade a wide range of investments, open an account with the cheapest * professional approved platform, Interactive brokers. Their clients from more than 200 countries and territories trade stocks, options, futures, currencies, bonds and funds around the world from a single integrated account.

This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative material. Simply Wall St has no position in the mentioned stocks.
*Interactive Brokers Ranked Least Expensive Broker By StockBrokers.com Online Annual Review 2020

Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.



Source link

Comments are closed.