Yahoo Finance Cango Inc.'s (NYSE:CANG) largest shareholders are retail investors with 32% ownership, insiders own 29%
Key Insights
The considerable ownership by retail investors in Cango indicates that they collectively have a greater say in management and business strategy
A total of 5 investors have a majority stake in the company with 58% ownership
A look at the shareholders of Cango Inc. (NYSE:CANG) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 32% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Meanwhile, individual insiders make up 29% of the company’s shareholders. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones.
In the chart below, we zoom in on the different ownership groups of Cango.
See our latest analysis for Cango
What Does The Institutional Ownership Tell Us About Cango?
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.
Cango already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Cango's earnings history below. Of course, the future is what really matters.
Hedge funds don't have many shares in Cango. The company's CEO Jiayuan Lin is the largest shareholder with 15% of shares outstanding. With 14% and 11% of the shares outstanding respectively, Xiaojun Zhang and DiDi Global Inc. are the second and third largest shareholders. Interestingly, the second-largest shareholder, Xiaojun Zhang is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.
On looking further, we found that 58% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Cango
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
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 a reasonable proportion of Cango Inc.. Insiders have a US$41m stake in this US$142m business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Cango. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Equity Ownership
With an ownership of 9.0%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
Public Company Ownership
We can see that public companies hold 20% of the Cango shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand Cango better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Cango .
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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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