Shijiazhuang Shangtai Technology Co., Ltd. (SZSE:001301) CEO Yongyue Ouyang's holdings dropped 6.6% in value as a result of the recent pullback

Key Insights

• Insiders appear to have a vested interest in Shijiazhuang Shangtai Technology's growth, as seen by their sizeable ownership
• The top 3 shareholders own 51% of the company
• Institutional ownership in Shijiazhuang Shangtai Technology is 27%

A look at the shareholders of Shijiazhuang Shangtai Technology Co., Ltd. (SZSE:001301) can tell us which group is most powerful. We can see that individual insiders own the lion's share in the company with 40% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, insiders endured the biggest losses as the stock fell by 6.6%.

Let's delve deeper into each type of owner of Shijiazhuang Shangtai Technology, beginning with the chart below.

View our latest analysis for Shijiazhuang Shangtai Technology

What Does The Institutional Ownership Tell Us About Shijiazhuang Shangtai Technology?

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.

As you can see, institutional investors have a fair amount of stake in Shijiazhuang Shangtai Technology. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Shijiazhuang Shangtai Technology'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 Shijiazhuang Shangtai Technology. The company's CEO Yongyue Ouyang is the largest shareholder with 37% of shares outstanding. Ningbo Meishan Bonded Port Area Chendao Investment Partnership Enterprise (L.P.) is the second largest shareholder owning 9.4% of common stock, and CMB International Capital Management (Shenzhen) Co, Ltd. holds about 5.0% of the company stock.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Shijiazhuang Shangtai Technology

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

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 Shijiazhuang Shangtai Technology Co., Ltd.. It has a market capitalization of just CN¥16b, and insiders have CN¥6.2b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 23% stake in Shijiazhuang Shangtai Technology. 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 Equity Ownership

Private equity firms hold a 9.4% stake in Shijiazhuang Shangtai Technology. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shijiazhuang Shangtai Technology better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Shijiazhuang Shangtai Technology (of which 1 is a bit concerning!) you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.