Titan Wind Energy (Suzhou) Co.,Ltd's (SZSE:002531) stock price dropped 3.8% last week; private companies would not be happy

Key Insights

• Titan Wind Energy (Suzhou)Ltd's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 2 shareholders own 50% of the company
• Institutional ownership in Titan Wind Energy (Suzhou)Ltd is 13%

If you want to know who really controls Titan Wind Energy (Suzhou) Co.,Ltd (SZSE:002531), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 51% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 3.8% decline in share price, private companies suffered the most losses.

Let's delve deeper into each type of owner of Titan Wind Energy (Suzhou)Ltd, beginning with the chart below.

View our latest analysis for Titan Wind Energy (Suzhou)Ltd

What Does The Institutional Ownership Tell Us About Titan Wind Energy (Suzhou)Ltd?

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.

Titan Wind Energy (Suzhou)Ltd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Titan Wind Energy (Suzhou)Ltd's historic earnings and revenue below, but keep in mind there's always more to the story.

Titan Wind Energy (Suzhou)Ltd is not owned by hedge funds. Shanghai Tianshen Investment Management Co., Ltd. is currently the largest shareholder, with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 21% and 2.7%, of the shares outstanding, respectively. In addition, we found that Yan Junxu, the CEO has 0.7% of the shares allocated to their name.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 50% stake.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Titan Wind Energy (Suzhou)Ltd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 less than 1% of Titan Wind Energy (Suzhou) Co.,Ltd. However, it's possible that insiders might have an indirect interest through a more complex structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around CN¥113m worth of shares (at current prices). 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

The general public-- including retail investors -- own 36% stake in the company, and hence can't easily be ignored. 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

It seems that Private Companies own 51%, of the Titan Wind Energy (Suzhou)Ltd stock. 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:

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. For instance, we've identified 2 warning signs for Titan Wind Energy (Suzhou)Ltd (1 makes us a bit uncomfortable) that you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.