Key Insights

• Weihai Baihe Biology Technological's significant insider ownership suggests inherent interests in company's expansion
• A total of 5 investors have a majority stake in the company with 51% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

A look at the shareholders of Weihai Baihe Biology Technological Co., Ltd. (SHSE:603102) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 55% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, insiders endured the biggest losses as the stock fell by 17%.

Let's delve deeper into each type of owner of Weihai Baihe Biology Technological, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Weihai Baihe Biology Technological?

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 Weihai Baihe Biology Technological. 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 Weihai Baihe Biology Technological, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Weihai Baihe Biology Technological. The company's CEO Xinli Liu is the largest shareholder with 41% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 3.0% and 2.7%, of the shares outstanding, respectively. Interestingly, the third-largest shareholder, Luzeng Liu is also a Chairman of Corporate Board, again, indicating strong insider ownership amongst the company's top shareholders.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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 Weihai Baihe Biology Technological

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 the majority of Weihai Baihe Biology Technological Co., Ltd.. This means they can collectively make decisions for the company. Given it has a market cap of CN¥1.9b, that means they have CN¥1.1b worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. 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 33% stake in Weihai Baihe Biology Technological. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Weihai Baihe Biology Technological has 1 warning sign we think you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.