Individual investors invested in EHang Holdings Limited (NASDAQ:EH) up 5.3% last week, insiders too were rewarded

EHang Holdings Limited -3.08% Pre

EHang Holdings Limited





-4.09% Pre

Key Insights

  • The considerable ownership by individual investors in EHang Holdings indicates that they collectively have a greater say in management and business strategy
  • The top 6 shareholders own 50% of the company
  • 36% of EHang Holdings is held by insiders

If you want to know who really controls EHang Holdings Limited (NASDAQ:EH), then you'll have to look at the makeup of its share registry. We can see that individual investors own the lion's share in the company with 46% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 5.3% increase in the stock price last week, individual investors profited the most, but insiders who own 36% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of EHang Holdings, beginning with the chart below.

See our latest analysis for EHang Holdings

NasdaqGM:EH Ownership Breakdown December 29th 2023

What Does The Institutional Ownership Tell Us About EHang Holdings?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that EHang Holdings does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 EHang Holdings' earnings history below. Of course, the future is what really matters.

NasdaqGM:EH Earnings and Revenue Growth December 29th 2023

We note that hedge funds don't have a meaningful investment in EHang Holdings. With a 34% stake, CEO Huazhi Hu is the largest shareholder. For context, the second largest shareholder holds about 6.4% of the shares outstanding, followed by an ownership of 3.2% by the third-largest shareholder.

We did some more digging and found that 6 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 EHang Holdings

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 EHang Holdings Limited. It has a market capitalization of just US$1.0b, and insiders have US$360m worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over EHang Holdings. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for EHang Holdings you should know about.

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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