Titan Wind Energy (Suzhou) Co.,Ltd's (SZSE:002531) stock price dropped 8.6% last week; private companies would not be happy

Key Insights

• The considerable ownership by private companies in Titan Wind Energy (Suzhou)Ltd indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 50% ownership
• 15% of Titan Wind Energy (Suzhou)Ltd is held by Institutions

Every investor in Titan Wind Energy (Suzhou) Co.,Ltd (SZSE:002531) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 51% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 8.6% decline in share price, private companies suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Titan Wind Energy (Suzhou)Ltd.

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

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

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Titan Wind Energy (Suzhou)Ltd does have institutional investors; and they hold a good portion of the company's stock. 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. In comparison, the second and third largest shareholders hold about 21% and 3.5% of the stock. Additionally, the company's CEO Yan Junxu directly holds 0.7% of the total shares outstanding.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 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. 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 Titan Wind Energy (Suzhou) Co.,Ltd in their own names. However, it's possible that insiders might have an indirect interest through a more complex structure. Keep in mind that it's a big company, and the insiders own CN¥93m 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

The general public-- including retail investors -- own 33% 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

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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Titan Wind Energy (Suzhou)Ltd that you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.