Insiders were the key beneficiaries as Yantai Yatong Precision Mechanical Corporation's (SHSE:603190) market cap rises to CN¥2.4b

Key Insights

• Yantai Yatong Precision Mechanical's significant insider ownership suggests inherent interests in company's expansion
• The top 2 shareholders own 62% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Yantai Yatong Precision Mechanical Corporation (SHSE:603190) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 62% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥235m last week.

Let's delve deeper into each type of owner of Yantai Yatong Precision Mechanical, beginning with the chart below.

Check out our latest analysis for Yantai Yatong Precision Mechanical

What Does The Institutional Ownership Tell Us About Yantai Yatong Precision Mechanical?

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 Yantai Yatong Precision Mechanical. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Yantai Yatong Precision Mechanical's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Yantai Yatong Precision Mechanical. Our data shows that Zhaoming Jiao is the largest shareholder with 47% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 15% and 4.3%, of the shares outstanding, respectively. Xianyang Jiao, who is the second-largest shareholder, also happens to hold the title of Senior Key Executive.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 Yantai Yatong Precision Mechanical

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems that insiders own more than half the Yantai Yatong Precision Mechanical Corporation stock. This gives them a lot of power. Given it has a market cap of CN¥2.4b, that means they have CN¥1.5b worth of shares. 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

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Yantai Yatong Precision Mechanical. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 7.8%, of the company's shares. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Yantai Yatong Precision Mechanical better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Yantai Yatong Precision Mechanical , and understanding them should be part of your investment process.

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.