Every investor in The People’s Insurance Company (Group) of China Limited (HKG:1339) should be aware of the most powerful shareholder groups. We can see that the state or government owns the lion’s share in the company with 61% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
As a result, state or government collectively scored the highest last week as the company hit HK$227b market cap following a 5.0% gain in the stock.
Let’s take a closer look to see what the different types of shareholders can tell us about People’s Insurance Company (Group) of China.
Our analysis indicates that 1339 is potentially undervalued!
What Does The Institutional Ownership Tell Us About People’s Insurance Company (Group) of China?
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.
People’s Insurance Company (Group) of China already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 People’s Insurance Company (Group) of China’s earnings history below. Of course, the future is what really matters.
People’s Insurance Company (Group) of China is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the Ministry of Finance People’s Republic of China with 61% of outstanding shares. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. National Council for Social Security Fund is the second largest shareholder owning 14% of common stock, and BlackRock, Inc. holds about 1.2% of the company’s stock.
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 understanding of a stock’s expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of People’s Insurance Company (Group) of China
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management runs the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
Our data suggests that insiders own less than 1% of The People’s Insurance Company (Group) of China Limited in their own names. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own HK$231m of stock. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.
General Public Ownership
With a 19% ownership, the general public, mostly comprising of individual investors, have some degree of sway over People’s Insurance Company (Group) of China. While this size of ownership may not be enough to sway a policy decision in their favor, they can still make a collective impact on company policies.
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 always like to check for a history of revenue growth. You can too, by accessing this free chart of historical revenue and earnings in this detailed graph.
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 is 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.
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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.