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What You Need To Know About Shandong Longquan Pipeline Engineering Co.,LTD's (SZSE:002671) Investor Composition

Simply Wall St ·  {{timeTz}}

A look at the shareholders of Shandong Longquan Pipeline Engineering Co.,LTD (SZSE:002671) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don't tell me what you think, tell me what you have in your portfolio.

Shandong Longquan Pipeline EngineeringLTD is a smaller company with a market capitalization of CN¥3.2b, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions don't own shares in the company. We can zoom in on the different ownership groups, to learn more about Shandong Longquan Pipeline EngineeringLTD.

See our latest analysis for Shandong Longquan Pipeline EngineeringLTD

ownership-breakdownSZSE:002671 Ownership Breakdown July 28th 2022

What Does The Lack Of Institutional Ownership Tell Us About Shandong Longquan Pipeline EngineeringLTD?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Shandong Longquan Pipeline EngineeringLTD might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growthSZSE:002671 Earnings and Revenue Growth July 28th 2022

Hedge funds don't have many shares in Shandong Longquan Pipeline EngineeringLTD. The company's largest shareholder is Zhongshan Lexing Enterprise Management Consulting Co., Ltd., with ownership of 23%. For context, the second largest shareholder holds about 17% of the shares outstanding, followed by an ownership of 1.5% by the third-largest shareholder.

A deeper look at our ownership data shows that the top 13 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Shandong Longquan Pipeline EngineeringLTD

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 some shares in Shandong Longquan Pipeline Engineering Co.,LTD. As individuals, the insiders collectively own CN¥163m worth of the CN¥3.2b company. This shows at least some alignment. 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 substantial 54% stake in Shandong Longquan Pipeline EngineeringLTD, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

We can see that Private Companies own 40%, of the shares on issue. 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 Shandong Longquan Pipeline EngineeringLTD better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Shandong Longquan Pipeline EngineeringLTD you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free 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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