Key Insights

• Significant control over Mingyue Optical LensLtd by private companies implies that the general public has more power to influence management and governance-related decisions
• 55% of the company is held by a single shareholder (Shanghai Mingyue Industrial Co., Ltd.)
• Institutional ownership in Mingyue Optical LensLtd is 15%

Every investor in Mingyue Optical Lens Co.,Ltd. (SZSE:301101) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 58% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While private companies were the group that benefitted the most from last week's CN¥596m market cap gain, institutions too had a 15% share in those profits.

In the chart below, we zoom in on the different ownership groups of Mingyue Optical LensLtd.

Check out our latest analysis for Mingyue Optical LensLtd

What Does The Institutional Ownership Tell Us About Mingyue Optical LensLtd?

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.

As you can see, institutional investors have a fair amount of stake in Mingyue Optical LensLtd. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Mingyue Optical LensLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Mingyue Optical LensLtd. Our data shows that Shanghai Mingyue Industrial Co., Ltd. is the largest shareholder with 55% of shares outstanding. This implies that they have majority interest control of the future of the company. Meanwhile, the second and third largest shareholders, hold 6.3% and 2.5%, of the shares outstanding, respectively. In addition, we found that Gongwan Xie, the CEO has 2.4% of the shares allocated to their name.

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 Mingyue Optical LensLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

We can see that insiders own shares in Mingyue Optical Lens Co.,Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥695m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

With a 11% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Mingyue Optical LensLtd. 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 Equity Ownership

Private equity firms hold a 6.3% stake in Mingyue Optical LensLtd. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

We can see that Private Companies own 58%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.