Key Insights

• Guangdong Huafeng New Energy TechnologyLtd's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 44% of the business is held by the top 17 shareholders
• 27% of Guangdong Huafeng New Energy TechnologyLtd is held by insiders

A look at the shareholders of Guangdong Huafeng New Energy Technology Co.,Ltd. (SZSE:002806) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 56% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders who own 27% came under pressure after market cap dropped to CN¥1.7b last week,retail investors took the most losses.

In the chart below, we zoom in on the different ownership groups of Guangdong Huafeng New Energy TechnologyLtd.

What Does The Institutional Ownership Tell Us About Guangdong Huafeng New Energy 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.

Less than 5% of Guangdong Huafeng New Energy TechnologyLtd is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hedge funds don't have many shares in Guangdong Huafeng New Energy TechnologyLtd. The company's largest shareholder is Guo Ying Tan, with ownership of 23%. Meanwhile, the second and third largest shareholders, hold 5.1% and 4.3%, of the shares outstanding, respectively. In addition, we found that Cheng Lin, the CEO has 4.3% of the shares allocated to their name.

On studying our ownership data, we found that 17 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Guangdong Huafeng New Energy TechnologyLtd

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.

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.

It seems insiders own a significant proportion of Guangdong Huafeng New Energy Technology Co.,Ltd.. Insiders have a CN¥455m stake in this CN¥1.7b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public -- including retail investors -- own 56% of Guangdong Huafeng New Energy TechnologyLtd. 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 Equity Ownership

With a stake of 5.1%, private equity firms could influence the Guangdong Huafeng New Energy TechnologyLtd board. 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.

Private Company Ownership

We can see that Private Companies own 10%, of the shares on issue. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 3 warning signs we've spotted with Guangdong Huafeng New Energy TechnologyLtd (including 2 which make us uncomfortable) .

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.

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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.