With a 52% stake, uCloudlink Group Inc. (NASDAQ:UCL) insiders have a lot riding on the company
Key Insights
uCloudlink Group's significant insider ownership suggests inherent interests in company's expansion
A total of 5 investors have a majority stake in the company with 55% ownership
If you want to know who really controls uCloudlink Group Inc. (NASDAQ:UCL), then you'll have to look at the makeup of its share registry. With 52% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
So, insiders of uCloudlink Group have a lot at stake and every decision they make on the company’s future is important to them from a financial point of view.
Let's delve deeper into each type of owner of uCloudlink Group, beginning with the chart below.
See our latest analysis for uCloudlink Group
What Does The Institutional Ownership Tell Us About uCloudlink Group?
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.
As you can see, institutional investors have a fair amount of stake in uCloudlink Group. 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 uCloudlink Group's earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in uCloudlink Group. Looking at our data, we can see that the largest shareholder is the CEO Chaohui Chen with 17% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 17% and 10%, of the shares outstanding, respectively.
Our research also brought to light the fact that roughly 55% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.
Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time.
Insider Ownership Of uCloudlink Group
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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our most recent data indicates that insiders own the majority of uCloudlink Group Inc.. This means they can collectively make decisions for the company. That means they own US$52m worth of shares in the US$101m company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public-- including retail investors -- own 24% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Equity Ownership
With a stake of 10%, private equity firms could influence the uCloudlink Group board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand uCloudlink Group better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with uCloudlink Group (including 1 which is a bit concerning) .
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.
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