What kind of shareholders constitute the share register of OneConnect Financial Technology Co., Ltd. (NYSE: OCFT)?
A look at the shareholders of OneConnect Financial Technology Co., Ltd. (NYSE: OCFT) can tell us which group is more powerful. Insiders often own a large portion of younger, smaller companies, while larger companies tend to have institutions as shareholders. Companies that were previously publicly owned tend to have less insider ownership.
With a market capitalization of US$601 million, OneConnect Financial Technology is a small cap stock, so it may not be well known to many institutional investors. Looking at our ownership group data (below), it appears that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about OneConnect Financial Technology.
Check out our latest analysis for OneConnect Financial Technology
What does institutional ownership tell us about OneConnect fintech?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.
As you can see, institutional investors hold a sizeable share of OneConnect Financial Technology. This implies that analysts working for these institutions have reviewed the stock and like it. But like everyone else, they can be wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see OneConnect Financial Technology’s historical revenue and earnings below, but keep in mind there’s always more to tell.
Investors should note that institutions actually own more than half of the company, so they can collectively wield significant power. Hedge funds don’t have a lot of shares in OneConnect Financial Technology. Ping An Asset Management Co., Ltd. is currently the largest shareholder of the company with 34% of the outstanding shares. For context, the second shareholder owns approximately 17% of the outstanding shares, followed by a 17% ownership by the third shareholder.
After digging a little deeper, we found that the 2 major shareholders collectively control more than half of the company’s shares, implying that they have considerable power to influence company decisions.
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 a stock’s expected performance. There are plenty of analysts covering the stock, so it might be interesting to see what they are predicting as well.
OneConnect Financial Technology Insider Ownership
The definition of an insider may differ slightly from country to country, but board members still matter. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.
Our data does not allow us to confirm that the members of the board of directors personally hold shares. It is unusual not to have at least some personal holdings of board members, so our data could be in error. A good next step would be to check how much the CEO is paid.
General public property
With a 10% stake, the general public, consisting primarily of individual investors, has some influence over OneConnect Financial Technology. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
Private Company Ownership
It appears that private companies hold 39% of the shares of OneConnect Financial Technology. It might be worth exploring this further. If related parties, such as insiders, have an interest in any of these private companies, this should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
It is always useful to think about the different groups that own shares in a company. But to better understand OneConnect financial technology, we need to consider many other factors. Be aware that OneConnect Financial Technology displays 2 warning signs in our investment analysis you should know…
But finally it’s the future, not the past, which will determine the performance of the owners of this company. Therefore, we think it’s advisable to take a look at this free report showing whether analysts are predicting a brighter future.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.