Both individual investors who control a good portion of Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology Co., Ltd. (SHSE:603300) along with institutions must be dismayed after last week's 13% decrease

Key Insights

• The considerable ownership by individual investors in Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 42% of the company
• Institutional ownership in Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology is 16%

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To get a sense of who is truly in control of Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology Co., Ltd. (SHSE:603300), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 58% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 13% decrease in the stock price last week, individual investors suffered the most losses, but institutions who own 16% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology.

See our latest analysis for Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology

What Does The Institutional Ownership Tell Us About Zhejiang Haikong Nanke Huatie Digital Intelligence and 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.

As you can see, institutional investors have a fair amount of stake in Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology. 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. 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 Haikong Nanke Huatie Digital Intelligence and Technology'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 Haikong Nanke Huatie Digital Intelligence and Technology. Hainan Development HoldingsNanhai Co., Ltd. is currently the company's largest shareholder with 14% of shares outstanding. With 9.0% and 4.4% of the shares outstanding respectively, Dan Feng Hu and China Jingu International Trust Co., Ltd., Asset Management Arm are the second and third largest shareholders.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Haikong Nanke Huatie Digital Intelligence and Technology Co., Ltd.. The insiders have a meaningful stake worth CN¥1.8b. Most would see this as a real positive. If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 58% stake in Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

It seems that Private Companies own 3.2%, of the Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology 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.

Public Company Ownership

It appears to us that public companies own 14% of Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology better, we need to consider many other factors. For example, we've discovered 3 warning signs for Zhejiang Haikong Nanke Huatie Digital Intelligence and Technology (2 can't be ignored!) that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.