Key Insights

• The considerable ownership by public companies in BOC Hong Kong (Holdings) indicates that they collectively have a greater say in management and business strategy
• Bank of China Limited owns 66% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

Every investor in BOC Hong Kong (Holdings) Limited (HKG:2388) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are public companies with 66% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies were the biggest beneficiaries of last week's 6.3% gain.

Let's delve deeper into each type of owner of BOC Hong Kong (Holdings), beginning with the chart below.

What Does The Institutional Ownership Tell Us About BOC Hong Kong (Holdings)?

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.

BOC Hong Kong (Holdings) already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 BOC Hong Kong (Holdings)'s earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in BOC Hong Kong (Holdings). Our data shows that Bank of China Limited is the largest shareholder with 66% of shares outstanding. This implies that they have majority interest control of the future of the company. With 1.4% and 1.3% of the shares outstanding respectively, BlackRock, Inc. and The Vanguard Group, Inc. are the second and third largest shareholders.

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 BOC Hong Kong (Holdings)

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.

We note our data does not show any board members holding shares, personally. It is rare to see such a low level of personal ownership, amongst the board (and it is possible that our data might be incomplete). Concerned investors should check here to see if insiders have been selling or buying.

General Public Ownership

The general public, who are usually individual investors, hold a 25% stake in BOC Hong Kong (Holdings). 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.

Public Company Ownership

It appears to us that public companies own 66% of BOC Hong Kong (Holdings). 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:

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. For instance, we've identified 1 warning sign for BOC Hong Kong (Holdings) that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.