Individual investors among Thinker Agricultural Machinery Co., Ltd.'s (SHSE:603789) largest shareholders, saw gain in holdings value after stock jumped 10% last week

Key Insights

• Significant control over Thinker Agricultural Machinery by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 5 shareholders own 50% of the company
• Insider ownership in Thinker Agricultural Machinery is 25%

To get a sense of who is truly in control of Thinker Agricultural Machinery Co., Ltd. (SHSE:603789), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 39% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, individual investors benefitted the most after the company's market cap rose by CN¥200m last week.

In the chart below, we zoom in on the different ownership groups of Thinker Agricultural Machinery.

Check out our latest analysis for Thinker Agricultural Machinery

What Does The Lack Of Institutional Ownership Tell Us About Thinker Agricultural Machinery?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Thinker Agricultural Machinery, for yourself, below.

Hedge funds don't have many shares in Thinker Agricultural Machinery. Our data shows that CRCC Urban Traffic Co., Ltd. is the largest shareholder with 17% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 9.1% of the stock. Shenqiang Zhang, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. Additionally, the company's CEO Zheng Bin directly holds 0.6% of the total shares outstanding.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Thinker Agricultural Machinery

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 insiders own a significant proportion of Thinker Agricultural Machinery Co., Ltd.. Insiders own CN¥537m worth of shares in the CN¥2.2b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 39% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Thinker Agricultural Machinery. 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

It seems that Private Companies own 36%, of the Thinker Agricultural Machinery 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Thinker Agricultural Machinery 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.

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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.