Insiders with their considerable ownership were the key benefactors as Himile Mechanical Science and Technology (Shandong) Co., Ltd (SZSE:002595) touches CN¥29b market cap

Key Insights

• Significant insider control over Himile Mechanical Science and Technology (Shandong) implies vested interests in company growth
• 51% of the business is held by the top 3 shareholders
• Institutions own 13% of Himile Mechanical Science and Technology (Shandong)

To get a sense of who is truly in control of Himile Mechanical Science and Technology (Shandong) Co., Ltd (SZSE:002595), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 58% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders scored the highest last week as the company hit CN¥29b market cap following a 3.2% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Himile Mechanical Science and Technology (Shandong).

See our latest analysis for Himile Mechanical Science and Technology (Shandong)

What Does The Institutional Ownership Tell Us About Himile Mechanical Science and Technology (Shandong)?

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 Himile Mechanical Science and Technology (Shandong) 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Himile Mechanical Science and Technology (Shandong)'s earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Himile Mechanical Science and Technology (Shandong). Gongyun Zhang is currently the largest shareholder, with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 14% and 6.8%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Himile Mechanical Science and Technology (Shandong)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our most recent data indicates that insiders own the majority of Himile Mechanical Science and Technology (Shandong) Co., Ltd. This means they can collectively make decisions for the company. That means insiders have a very meaningful CN¥17b stake in this CN¥29b business. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

The general public, who are usually individual investors, hold a 29% stake in Himile Mechanical Science and Technology (Shandong). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Himile Mechanical Science and Technology (Shandong) better, we need to consider many other factors. Take risks for example - Himile Mechanical Science and Technology (Shandong) has 1 warning sign we think you should be aware of.

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.

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