Following recent decline, NetEase, Inc.’s (NASDAQ:NTES) top shareholder CEO Lei Ding sees holdings value drop by 6.6%


If you want to know who really controls NetEase, Inc. (NASDAQ:NTES), you need to look at the composition of the stock register. And the group holding the biggest piece of the pie are individual insiders with 47% ownership. In other words, the group will gain the most (or lose the most) from their investment in the company.

As the market cap fell to $49 billion last week, insiders suffered the heaviest losses than any of the company’s other shareholder groups.

In the table below we enlarge the different ownership groups of NetEase.

However, if you prefer to see where the Opportunities and risks lie in the industry of NTESyou can view our analysis of the US entertainment industry.

property breakdown
NasdaqGS: NTES Ownership Breakdown September 22, 2022

What Does Institutional Ownership Tell Us About NetEase?

Many institutions measure their performance against an index that approximates the local market. As a result, they tend to pay more attention to companies that are included in major indices.

NetEase already has institutions in the share register. In fact, they own a respectable stake in the company. This means that the analysts who work for these institutes have looked at the stock and like it. But just like everyone else, they can be wrong. It’s not uncommon for the stock price to fall sharply when two large institutional investors attempt to sell a stock at the same time. So, it’s worth checking out NetEase’s past earnings history (below). Of course, keep in mind that there are other factors to consider as well.

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Profit and Revenue Growth
NasdaqGS:NTES earnings and revenue growth September 22, 2022

NetEase is not owned by hedge funds. The company’s CEO, Lei Ding, is the largest shareholder with 47% of the outstanding shares. BlackRock, Inc. and Invesco Ltd. hold 2.9% and 2.5% of the outstanding shares, respectively. the second and third largest shareholders.

Upon further research, we found that the top three shareholders together control more than half of the company’s stock, meaning they have considerable power to influence company decisions.

While examining a company’s institutional ownership can add value to your research, it’s also a good practice to research analyst recommendations to gain a deeper understanding of a stock’s expected performance. There are many analysts covering the stock, so it might be worth seeing what they’re forecasting as well.

Insider ownership of NetEase

While the precise definition of an insider can be subjective, almost everyone considers a board member to be an insider. Management runs the business, but the CEO is accountable to the board even if he or she is a member.

In general, I think insider ownership is a good thing. In some cases, however, it becomes more difficult for other shareholders to hold the board accountable for decisions.

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It appears that insiders own a significant stake in NetEase, Inc. It has a market cap of just $49 billion, and insiders have $23 billion worth of stock to their own names. That’s pretty significant. Most would say that shows a good level of alignment with shareholders, especially for a company of this size. You can click here to see if these Insiders have bought or sold.

General Public Property

With a 17% stake, the general public, which consists mostly of individual investors, has some influence over NetEase. While this ownership size is substantial, it may not be enough to change company policy if the decision is not aligned with other major shareholders.

Next Steps:

It’s always worth thinking about the different groups that own shares in a company. But to better understand NetEase, we need to consider many other factors.

Many find it useful take a deep look at how a company has performed in the past. You can access it detailed graphics of past earnings, receipts and cash flows.

But ultimately it is the future, not the past that determines how well the owners of this business will do. Therefore, we think it’s wise to take a look at this free report that shows whether analysts are predicting a brighter future.

Note: The figures in this article are calculated using data for the last twelve months, relating to the 12-month period ending on the last date of the month to which the financial statements are dated. This may not tally with the annual report figures for the full year.

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This Simply Wall St article is of a general nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended as financial advice. It is not a recommendation to buy or sell any stock and does not take into account your goals or financial situation. Our goal is to offer you long-term focused analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any of the stocks mentioned.

The assessment is complex, but we help to simplify it.

find out if NetEase may be over or under priced by reviewing our comprehensive analysis which includes the following Fair Value Estimates, Risks and Warnings, Dividends, Insider Trading and Financial Health.

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