Hubei Wanrun New Energy Technology Co.,Ltd.'s (SHSE:688275) market cap rose CN¥598m last week; retail investors who hold 37% profited and so did insiders

Key Insights

• Significant control over Hubei Wanrun New Energy TechnologyLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• A total of 9 investors have a majority stake in the company with 52% ownership
• Insiders own 33% of Hubei Wanrun New Energy TechnologyLtd

Every investor in Hubei Wanrun New Energy Technology Co.,Ltd. (SHSE:688275) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 37% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 20% increase in the stock price last week, retail investors profited the most, but insiders who own 33% stock also stood to gain from the increase.

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

View our latest analysis for Hubei Wanrun New Energy TechnologyLtd

What Does The Institutional Ownership Tell Us About Hubei Wanrun 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.

Hubei Wanrun New Energy TechnologyLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Hubei Wanrun New Energy TechnologyLtd's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Hubei Wanrun New Energy TechnologyLtd. With a 24% stake, CEO Shiqi Liu is the largest shareholder. Meanwhile, the second and third largest shareholders, hold 9.0% and 6.0%, of the shares outstanding, respectively.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 Hubei Wanrun New Energy TechnologyLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 most recent data indicates that insiders own a reasonable proportion of Hubei Wanrun New Energy Technology Co.,Ltd.. Insiders own CN¥1.2b worth of shares in the CN¥3.6b 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

The general public, who are usually individual investors, hold a 37% stake in Hubei Wanrun 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 6.0%, private equity firms could influence the Hubei Wanrun New Energy TechnologyLtd board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

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 Hubei Wanrun New Energy TechnologyLtd 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.