Every investor in GSH Corporation Limited (SGX:BDX) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 78% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And looking at our data, we can see that insiders have bought shares recently. This could be interpreted as insiders anticipating a rise in stock prices in the near future.
Let's take a closer look to see what the different types of shareholders can tell us about GSH.
What Does The Lack Of Institutional Ownership Tell Us About GSH?
Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.
There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. GSH's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
SGX:BDX Earnings and Revenue Growth May 5th 2024
We note that hedge funds don't have a meaningful investment in GSH. Our data suggests that Seng Hui Goi, who is also the company's Top Key Executive, holds the most number of shares at 64%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. With 8.1% and 5.1% of the shares outstanding respectively, Guan Hui Ee and Goodview Properties Pte Ltd. are the second and third largest shareholders. Interestingly, the second-largest shareholder, Guan Hui Ee is also Chief Executive Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.
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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of GSH
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.
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.
Our most recent data indicates that insiders own the majority of GSH Corporation Limited. This means they can collectively make decisions for the company. Given it has a market cap of S$315m, that means they have S$245m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 11% stake in GSH. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
Our data indicates that Private Companies hold 11%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand GSH better, we need to consider many other factors. Be aware that GSH is showing 3 warning signs in our investment analysis, you should know about...
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.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
