Key Insights

• Significant control over Jiangsu Guomao Reducer by private companies implies that the general public has more power to influence management and governance-related decisions
• Guomao Reducer Group Co., Ltd. owns 50% of the company
• 19% of Jiangsu Guomao Reducer is held by insiders

A look at the shareholders of Jiangsu Guomao Reducer Co., Ltd. (SHSE:603915) can tell us which group is most powerful. With 54% stake, private companies 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.

While private companies were the group that benefitted the most from last week's CN¥397m market cap gain, insiders too had a 19% share in those profits.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangsu Guomao Reducer.

See our latest analysis for Jiangsu Guomao Reducer

What Does The Institutional Ownership Tell Us About Jiangsu Guomao Reducer?

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 Jiangsu Guomao Reducer. 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 Jiangsu Guomao Reducer's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Jiangsu Guomao Reducer. Guomao Reducer Group Co., Ltd. is currently the company's largest shareholder with 50% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Meanwhile, the second and third largest shareholders, hold 9.6% and 9.5%, of the shares outstanding, respectively. Bin Xu, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Jiangsu Guomao Reducer

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.

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 Jiangsu Guomao Reducer Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥2.2b stake in this CN¥12b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 18% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Jiangsu Guomao Reducer. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 54%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. To that end, you should be aware of the 1 warning sign we've spotted with Jiangsu Guomao Reducer .

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.