Qinchuan Machine Tool & Tool Group Share Co., Ltd.'s (SZSE:000837) biggest owners are private companies who got richer after stock soared 3.9% last week

Key Insights

• The considerable ownership by private companies in Qinchuan Machine Tool & Tool Group Share indicates that they collectively have a greater say in management and business strategy
• The top 8 shareholders own 51% of the company
• 10% of Qinchuan Machine Tool & Tool Group Share is held by Institutions

A look at the shareholders of Qinchuan Machine Tool & Tool Group Share Co., Ltd. (SZSE:000837) can tell us which group is most powerful. With 46% stake, private companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit CN¥10b market cap following a 3.9% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Qinchuan Machine Tool & Tool Group Share.

Check out our latest analysis for Qinchuan Machine Tool & Tool Group Share

What Does The Institutional Ownership Tell Us About Qinchuan Machine Tool & Tool Group Share?

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 Qinchuan Machine Tool & Tool Group Share. 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 Qinchuan Machine Tool & Tool Group Share'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 Qinchuan Machine Tool & Tool Group Share. Shaanxi Fast Auto Drive Group Co., Ltd is currently the largest shareholder, with 35% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 1.0%, of the shares outstanding, respectively.

We did some more digging and found that 8 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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Qinchuan Machine Tool & Tool Group Share

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.

Our information suggests that Qinchuan Machine Tool & Tool Group Share Co., Ltd. insiders own under 1% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Keep in mind that it's a big company, and the insiders own CN¥268k worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 44% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Qinchuan Machine Tool & Tool Group Share. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 46%, 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Qinchuan Machine Tool & Tool Group Share better, we need to consider many other factors. For instance, we've identified 2 warning signs for Qinchuan Machine Tool & Tool Group Share that you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.