Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd's (SZSE:002284) market cap dropped CN¥392m last week; Retail investors bore the brunt

Key Insights

• Significant control over Zhejiang Asia-Pacific Mechanical & ElectronicLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 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

A look at the shareholders of Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd (SZSE:002284) can tell us which group is most powerful. We can see that retail investors own the lion's share in the company with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, retail investors endured the biggest losses as the stock fell by 6.6%.

Let's delve deeper into each type of owner of Zhejiang Asia-Pacific Mechanical & ElectronicLtd, beginning with the chart below.

See our latest analysis for Zhejiang Asia-Pacific Mechanical & ElectronicLtd

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

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.

Since institutions own only a small portion of Zhejiang Asia-Pacific Mechanical & ElectronicLtd, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. 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.

Zhejiang Asia-Pacific Mechanical & ElectronicLtd is not owned by hedge funds. The company's largest shareholder is Asia-Pacific Electrical Group Co., Ltd, with ownership of 37%. 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.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

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 see that insiders own shares in Zhejiang Asia-Pacific Mechanical & Electronic Co.,Ltd. As individuals, the insiders collectively own CN¥407m worth of the CN¥5.6b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public -- including retail investors -- own 50% of Zhejiang Asia-Pacific Mechanical & ElectronicLtd. 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 Company Ownership

It seems that Private Companies own 37%, of the Zhejiang Asia-Pacific Mechanical & ElectronicLtd stock. 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. Be aware that Zhejiang Asia-Pacific Mechanical & ElectronicLtd is showing 1 warning sign in our investment analysis , you should know about...

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.