Individual investors among Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd's (SZSE:002284) largest stockholders and were hit after last week's 7.5% price drop

Key Insights

• Significant control over Zhejiang Asia-Pacific Mechanical & ElectronicLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 17 shareholders own 50% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd (SZSE:002284), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, individual investors endured the biggest losses as the stock fell by 7.5%.

In the chart below, we zoom in on the different ownership groups of Zhejiang Asia-Pacific Mechanical & ElectronicLtd.

Check out our latest analysis for Zhejiang Asia-Pacific Mechanical & ElectronicLtd

What Does The Institutional Ownership Tell Us About Zhejiang Asia-Pacific Mechanical & ElectronicLtd?

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 Zhejiang Asia-Pacific Mechanical & ElectronicLtd. 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 Zhejiang Asia-Pacific Mechanical & ElectronicLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Zhejiang Asia-Pacific Mechanical & ElectronicLtd. Our data shows that Asia-Pacific Electrical Group Co., Ltd is the largest shareholder with 37% of shares outstanding. For context, the second largest shareholder holds about 5.3% of the shares outstanding, followed by an ownership of 1.8% by the third-largest shareholder.

A closer look at our ownership figures suggests that the top 17 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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 Zhejiang Asia-Pacific Mechanical & ElectronicLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

We can report that insiders do own shares in Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd. As individuals, the insiders collectively own CN¥363m worth of the CN¥5.0b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zhejiang Asia-Pacific Mechanical & ElectronicLtd. 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 Company Ownership

It seems that Private Companies own 37%, of the Zhejiang Asia-Pacific Mechanical & ElectronicLtd stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Asia-Pacific Mechanical & ElectronicLtd better, we need to consider many other factors. For instance, we've identified 1 warning sign for Zhejiang Asia-Pacific Mechanical & ElectronicLtd that 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.