Institutions along with individual investors who hold considerable shares inAotecar New Energy Technology Co., Ltd. (SZSE:002239) come under pressure; lose 4.5% of holdings value

Key Insights

• The considerable ownership by individual investors in Aotecar New Energy Technology indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 12 shareholders
• Institutions own 26% of Aotecar New Energy Technology

If you want to know who really controls Aotecar New Energy Technology Co., Ltd. (SZSE:002239), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 49% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions, who own 26% shares weren’t spared from last week’s CN¥409m market cap drop, individual investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of Aotecar New Energy Technology.

View our latest analysis for Aotecar New Energy Technology

What Does The Institutional Ownership Tell Us About Aotecar New Energy Technology?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Aotecar New Energy Technology already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Aotecar New Energy Technology's historic earnings and revenue below, but keep in mind there's always more to the story.

Aotecar New Energy Technology is not owned by hedge funds. Our data shows that Hubei Changjiang No. 1 Industrial Investment Partnership Enterprise (Limited Partnership) is the largest shareholder with 21% of shares outstanding. For context, the second largest shareholder holds about 13% of the shares outstanding, followed by an ownership of 4.1% by the third-largest shareholder.

After doing some more digging, we found that the top 12 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

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 Aotecar New Energy Technology

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Aotecar New Energy Technology Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥383m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Aotecar New Energy Technology. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

Our data indicates that Private Companies hold 20%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 1 warning sign for Aotecar New Energy Technology that you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.