Key Insights

• Insiders appear to have a vested interest in Shijiazhuang Shangtai Technology's growth, as seen by their sizeable ownership
• A total of 3 investors have a majority stake in the company with 52% ownership
• Institutions own 14% of Shijiazhuang Shangtai Technology

A look at the shareholders of Shijiazhuang Shangtai Technology Co., Ltd. (SZSE:001301) can tell us which group is most powerful. With 42% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As market cap fell to CN¥11b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about Shijiazhuang Shangtai Technology.

Check out our latest analysis for Shijiazhuang Shangtai Technology

What Does The Institutional Ownership Tell Us About Shijiazhuang Shangtai Technology?

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.

We can see that Shijiazhuang Shangtai Technology does have institutional investors; and they hold a good portion of the company's stock. 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 Shijiazhuang Shangtai Technology's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Shijiazhuang Shangtai Technology. With a 37% stake, CEO Yongyue Ouyang is the largest shareholder. With 10% and 5.5% of the shares outstanding respectively, Ningbo Meishan Bonded Port Area Chendao Investment Partnership Enterprise (L.P.) and CMB International Capital Management (Shenzhen) Co, Ltd. are the second and third largest shareholders.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 Shijiazhuang Shangtai Technology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 Shijiazhuang Shangtai Technology Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥4.5b stake in this CN¥11b 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

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 Equity Ownership

Private equity firms hold a 16% stake in Shijiazhuang Shangtai Technology. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shijiazhuang Shangtai Technology better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Shijiazhuang Shangtai Technology (of which 1 is a bit concerning!) you should know about.

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.