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Guangdong Lyric Robot Automation Co., Ltd.'s (SHSE:688499) Market Cap Surged CN¥403m Last Week, Private Companies Who Have a Lot Riding on the Company Were Rewarded

Simply Wall St ·  07/01/2023 09:40

Key Insights

  • Significant control over Guangdong Lyric Robot Automation by private companies implies that the general public has more power to influence management and governance-related decisions
  • A total of 3 investors have a majority stake in the company with 52% ownership
  • Institutions own 19% of Guangdong Lyric Robot Automation

Every investor in Guangdong Lyric Robot Automation Co., Ltd. (SHSE:688499) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 52% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, private companies benefitted the most after the company's market cap rose by CN¥403m last week.

Let's delve deeper into each type of owner of Guangdong Lyric Robot Automation, beginning with the chart below.

See our latest analysis for Guangdong Lyric Robot Automation

ownership-breakdown
SHSE:688499 Ownership Breakdown July 1st 2023

What Does The Institutional Ownership Tell Us About Guangdong Lyric Robot Automation?

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 companies to have some institutions on the register, especially if they are growing.

Guangdong Lyric Robot Automation 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Guangdong Lyric Robot Automation's historic earnings and revenue below, but keep in mind there's always more to the story.

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SHSE:688499 Earnings and Revenue Growth July 1st 2023

Hedge funds don't have many shares in Guangdong Lyric Robot Automation. The company's largest shareholder is Huizhou Lyric Robot Investment Co., Ltd., with ownership of 45%. For context, the second largest shareholder holds about 3.2% of the shares outstanding, followed by an ownership of 3.1% by the third-largest shareholder.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Guangdong Lyric Robot Automation

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run 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 most recent data indicates that insiders own some shares in Guangdong Lyric Robot Automation Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥433m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 21% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guangdong Lyric Robot Automation. 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.

Private Company Ownership

Our data indicates that Private Companies hold 52%, 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:

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. Case in point: We've spotted 3 warning signs for Guangdong Lyric Robot Automation you should be aware of, and 1 of them is a bit unpleasant.

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.

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