Guizhou Space Appliance Co., LTD's (SZSE:002025) market cap dropped CN¥818m last week; Private companies bore the brunt

Key Insights

• Guizhou Space Appliance's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 7 shareholders own 50% of the company
• Institutional ownership in Guizhou Space Appliance is 22%

Every investor in Guizhou Space Appliance Co., LTD (SZSE:002025) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 41% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, private companies endured the biggest losses as the stock fell by 3.9%.

Let's take a closer look to see what the different types of shareholders can tell us about Guizhou Space Appliance.

See our latest analysis for Guizhou Space Appliance

What Does The Institutional Ownership Tell Us About Guizhou Space Appliance?

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 Guizhou Space Appliance does have institutional investors; and they hold a good portion of the company's stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Guizhou Space Appliance, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Guizhou Space Appliance. Our data shows that China Aerospace Science and Industry Corporation Limited is the largest shareholder with 41% of shares outstanding. With 2.0% and 1.6% of the shares outstanding respectively, National Council for Social Security Fund and Harvest Fund Management Co. Ltd. are the second and third largest shareholders.

We also observed that the top 7 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.

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

Insider Ownership Of Guizhou Space Appliance

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 data suggests that insiders own under 1% of Guizhou Space Appliance Co., LTD in their own names. However, it's possible that insiders might have an indirect interest through a more complex structure. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own CN¥20m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

With a 37% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guizhou Space Appliance. 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 41%, of the Guizhou Space Appliance 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 1 warning sign for Guizhou Space Appliance that you should be aware of before investing here.

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.