Retail investors in Ningbo Ronbay New Energy Technology Co.,Ltd. (SHSE:688005) are its biggest bettors, and their bets paid off as stock gained 8.3% last week

Key Insights

• Significant control over Ningbo Ronbay New Energy TechnologyLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 10 shareholders own 51% of the company
• Institutions own 26% of Ningbo Ronbay New Energy TechnologyLtd

If you want to know who really controls Ningbo Ronbay New Energy Technology Co.,Ltd. (SHSE:688005), then you'll have to look at the makeup of its share registry. We can see that retail investors own the lion's share in the company with 37% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, retail investors collectively scored the highest last week as the company hit CN¥13b market cap following a 8.3% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Ningbo Ronbay New Energy TechnologyLtd.

Check out our latest analysis for Ningbo Ronbay New Energy TechnologyLtd

What Does The Institutional Ownership Tell Us About Ningbo Ronbay New Energy TechnologyLtd?

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.

As you can see, institutional investors have a fair amount of stake in Ningbo Ronbay New Energy TechnologyLtd. 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 Ningbo Ronbay New Energy TechnologyLtd'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 Ningbo Ronbay New Energy TechnologyLtd. Beijing Ronbay New Energy Investment Management Co., Ltd. is currently the company's largest shareholder with 30% of shares outstanding. With 4.6% and 4.2% of the shares outstanding respectively, Beijing Ronbay Investment Holdings Co., Ltd. and China Asset Management Co. Ltd. are the second and third largest shareholders.

We did some more digging and found that 10 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Ningbo Ronbay New Energy TechnologyLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our data suggests that insiders own under 1% of Ningbo Ronbay New Energy Technology Co.,Ltd. in their own names. But they may have an indirect interest through a corporate structure that we haven't picked up on. Keep in mind that it's a big company, and the insiders own CN¥55m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 37% stake in Ningbo Ronbay New Energy TechnologyLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With a stake of 30%, private equity firms could influence the Ningbo Ronbay New Energy TechnologyLtd board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 6.4%, 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - Ningbo Ronbay New Energy TechnologyLtd has 5 warning signs we think you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.

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