A look at the shareholders of Shenzhen Breo Technology Co., Ltd. (SHSE:688793) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.
Shenzhen Breo Technology is a smaller company with a market capitalization of CN¥3.3b, so it may still be flying under the radar of many institutional investors. In the chart below, we can see that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about Shenzhen Breo Technology.
View our latest analysis for Shenzhen Breo TechnologySHSE:688793 Ownership Breakdown May 31st 2022
What Does The Institutional Ownership Tell Us About Shenzhen Breo Technology?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
Shenzhen Breo Technology already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Shenzhen Breo Technology's earnings history below. Of course, the future is what really matters.SHSE:688793 Earnings and Revenue Growth May 31st 2022
We note that hedge funds don't have a meaningful investment in Shenzhen Breo Technology. From our data, we infer that the largest shareholder is Xuejun Ma (who also holds the title of Senior Key Executive) with 52% 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. Shenzhen Dingyuanhong Investment Co., Ltd. is the second largest shareholder owning 6.3% of common stock, and Qiaoqing Wang holds about 5.6% of the company stock. Interestingly, the third-largest shareholder, Qiaoqing Wang is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Shenzhen Breo Technology
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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
Our most recent data indicates that insiders own the majority of Shenzhen Breo Technology Co., Ltd.. This means they can collectively make decisions for the company. That means they own CN¥1.9b worth of shares in the CN¥3.3b 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
With a 19% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shenzhen Breo Technology. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Private Company Ownership
It seems that Private Companies own 9.3%, of the Shenzhen Breo Technology stock. 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.
While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Shenzhen Breo Technology (at least 1 which is concerning) , and understanding them should be part of your investment process.
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.