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What You Need To Know About Zhejiang Wellsun Intelligent Technology Co.,Ltd.'s (SZSE:300882) Investor Composition

Simply Wall St ·  {{timeTz}}

Every investor in Zhejiang Wellsun Intelligent Technology Co.,Ltd. (SZSE:300882) should be aware of the most powerful shareholder groups. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

With a market capitalization of CN¥3.6b, Zhejiang Wellsun Intelligent TechnologyLtd is a small cap stock, so it might not be well known by many institutional investors. In the chart below, we can see that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Zhejiang Wellsun Intelligent TechnologyLtd.

Check out our latest analysis for Zhejiang Wellsun Intelligent TechnologyLtd

ownership-breakdownSZSE:300882 Ownership Breakdown July 8th 2022

What Does The Institutional Ownership Tell Us About Zhejiang Wellsun Intelligent TechnologyLtd?

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 Zhejiang Wellsun Intelligent TechnologyLtd. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Zhejiang Wellsun Intelligent TechnologyLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growthSZSE:300882 Earnings and Revenue Growth July 8th 2022

We note that hedge funds don't have a meaningful investment in Zhejiang Wellsun Intelligent TechnologyLtd. The company's largest shareholder is Zhejiang Wellsun Holdings Co., Ltd., with ownership of 53%. This implies that they have majority interest control of the future of the company. With 8.2% and 5.1% of the shares outstanding respectively, Tiantai Wellsun Zhihe Investment Partnership Enterprise (Limited Partnership) and Hua Zhou are the second and third largest shareholders. Hua Zhou, 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. 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 Zhejiang Wellsun Intelligent TechnologyLtd

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.

Our most recent data indicates that insiders own a reasonable proportion of Zhejiang Wellsun Intelligent Technology Co.,Ltd.. Insiders have a CN¥370m stake in this CN¥3.6b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 28% stake in the company, and hence can't easily be ignored. 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 53%, of the Zhejiang Wellsun Intelligent TechnologyLtd stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Wellsun Intelligent TechnologyLtd better, we need to consider many other factors. Be aware that Zhejiang Wellsun Intelligent TechnologyLtd is showing 2 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.

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