Individual investors invested in Zhejiang Haiyan Power System Resources Environmental Technology Co.,Ltd. (SHSE:688565) up 10% last week, insiders too were rewarded

Key Insights

• Significant control over Zhejiang Haiyan Power System Resources Environmental TechnologyLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 8 shareholders
• Insider ownership in Zhejiang Haiyan Power System Resources Environmental TechnologyLtd is 41%

Every investor in Zhejiang Haiyan Power System Resources Environmental Technology Co.,Ltd. (SHSE:688565) should be aware of the most powerful shareholder groups. With 46% stake, individual investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 10% increase in the stock price last week, individual investors profited the most, but insiders who own 41% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of Zhejiang Haiyan Power System Resources Environmental TechnologyLtd.

See our latest analysis for Zhejiang Haiyan Power System Resources Environmental TechnologyLtd

What Does The Institutional Ownership Tell Us About Zhejiang Haiyan Power System Resources Environmental 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.

We can see that Zhejiang Haiyan Power System Resources Environmental TechnologyLtd does have institutional investors; and they hold a good portion of the company's stock. 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 Zhejiang Haiyan Power System Resources Environmental TechnologyLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Zhejiang Haiyan Power System Resources Environmental TechnologyLtd is not owned by hedge funds. The company's CEO Wanzhong Shen is the largest shareholder with 35% of shares outstanding. The second and third largest shareholders are Shenzhen Zhongguang Hehengfeng Equity Investment Fund Management Co., Ltd. and Vast Wintersweet Limited, with an equal amount of shares to their name at 4.6%.

We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Zhejiang Haiyan Power System Resources Environmental TechnologyLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Zhejiang Haiyan Power System Resources Environmental Technology Co.,Ltd.. It has a market capitalization of just CN¥754m, and insiders have CN¥310m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zhejiang Haiyan Power System Resources Environmental TechnologyLtd. 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

It seems that Private Companies own 4.6%, of the Zhejiang Haiyan Power System Resources Environmental TechnologyLtd stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. Case in point: We've spotted 2 warning signs for Zhejiang Haiyan Power System Resources Environmental TechnologyLtd 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.

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