Sunlands Technology Group's (NYSE:STG) Top Key Executive Peng Ou is the most upbeat insider, and their holdings increased by 28% last week

SUNLANDS ONLINE EDUCATION GROUP +1.94%

SUNLANDS ONLINE EDUCATION GROUP

STG

8.16

+1.94%

Key Insights

  • Significant insider control over Sunlands Technology Group implies vested interests in company growth
  • 53% of the business is held by the top 2 shareholders
  • Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Sunlands Technology Group (NYSE:STG), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 53% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, insiders benefitted the most after the company's market cap rose by US$30m last week.

Let's delve deeper into each type of owner of Sunlands Technology Group, beginning with the chart below.

Check out our latest analysis for Sunlands Technology Group

ownership-breakdown
NYSE:STG Ownership Breakdown December 29th 2023

What Does The Institutional Ownership Tell Us About Sunlands Technology Group?

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.

Institutions have a very small stake in Sunlands Technology Group. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

earnings-and-revenue-growth
NYSE:STG Earnings and Revenue Growth December 29th 2023

We note that hedge funds don't have a meaningful investment in Sunlands Technology Group. From our data, we infer that the largest shareholder is Peng Ou (who also holds the title of Top Key Executive) with 41% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. With 12% and 8.2% of the shares outstanding respectively, Primavera Capital Group and New Oriental Education & Technology Group Inc. are the second and third largest shareholders. Furthermore, CEO Tongbo Liu is the owner of 7.5% of the company's shares.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 53% stake.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Sunlands Technology Group

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

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.

It seems that insiders own more than half the Sunlands Technology Group stock. This gives them a lot of power. That means they own US$72m worth of shares in the US$137m 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, who are usually individual investors, hold a 22% stake in Sunlands Technology Group. 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

Private equity firms hold a 12% stake in Sunlands Technology Group. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Public Company Ownership

We can see that public companies hold 8.2% of the Sunlands Technology Group shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 1 warning sign for Sunlands Technology Group that you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.

Every question you ask will be answered
Scan the QR code to contact us
whatsapp
Also you can contact us via