Private companies among Jiangsu Guotai International Group Co., Ltd.'s (SZSE:002091) largest stockholders and were hit after last week's 4.6% price drop

Key Insights

• The considerable ownership by private companies in Jiangsu Guotai International Group indicates that they collectively have a greater say in management and business strategy
• A total of 8 investors have a majority stake in the company with 50% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

Every investor in Jiangsu Guotai International Group Co., Ltd. (SZSE:002091) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 46% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And last week, private companies endured the biggest losses as the stock fell by 4.6%.

In the chart below, we zoom in on the different ownership groups of Jiangsu Guotai International Group.

View our latest analysis for Jiangsu Guotai International Group

What Does The Institutional Ownership Tell Us About Jiangsu Guotai International Group?

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 Jiangsu Guotai International Group 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. 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 Jiangsu Guotai International Group, (below). Of course, keep in mind that there are other factors to consider, too.

Jiangsu Guotai International Group is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Jiangsu Guotai International Trading Co.,Ltd with 32% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.5% and 2.5%, of the shares outstanding, respectively.

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 Jiangsu Guotai International Group

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. 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.

Shareholders would probably be interested to learn that insiders own shares in Jiangsu Guotai International Group Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥421m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 45% 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 46%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Jiangsu Guotai International Group better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Jiangsu Guotai International Group you should know about.

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.

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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.