Individual investors in KEDE Numerical Control Co., Ltd. (SHSE:688305) are its biggest bettors, and their bets paid off as stock gained 8.1% last week

Key Insights

• The considerable ownership by individual investors in KEDE Numerical Control indicates that they collectively have a greater say in management and business strategy
• A total of 6 investors have a majority stake in the company with 51% ownership
• Insider ownership in KEDE Numerical Control is 18%

If you want to know who really controls KEDE Numerical Control Co., Ltd. (SHSE:688305), then you'll have to look at the makeup of its share registry. With 35% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors were the biggest beneficiaries of last week’s 8.1% gain.

Let's take a closer look to see what the different types of shareholders can tell us about KEDE Numerical Control.

View our latest analysis for KEDE Numerical Control

What Does The Institutional Ownership Tell Us About KEDE Numerical Control?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that KEDE Numerical Control does have institutional investors; and they hold a good portion of the company's stock. 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 KEDE Numerical Control's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in KEDE Numerical Control. Our data shows that Dalian Guangyang Technology Group Co., Ltd. is the largest shareholder with 26% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.3% and 5.2% of the stock. Menglu Song, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

We did some more digging and found that 6 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 studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of KEDE Numerical Control

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. 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 most recent data indicates that insiders own a reasonable proportion of KEDE Numerical Control Co., Ltd.. Insiders own CN¥1.2b worth of shares in the CN¥6.6b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 35% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 31%, of the shares on issue. 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:

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. Be aware that KEDE Numerical Control is showing 1 warning sign in our investment analysis , you should know about...

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.

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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.

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