Shenzhen Zhongzhuang Construction Group Co.,Ltd's (SZSE:002822) 11% gain last week benefited both individual investors who own 60% as well as insiders

Key Insights

• Significant control over Shenzhen Zhongzhuang Construction GroupLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 15 shareholders own 40% of the company
• Insider ownership in Shenzhen Zhongzhuang Construction GroupLtd is 36%

If you want to know who really controls Shenzhen Zhongzhuang Construction Group Co.,Ltd (SZSE:002822), 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 60% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

While individual investors were the group that reaped the most benefits after last week’s 11% price gain, insiders also received a 36% cut.

Let's delve deeper into each type of owner of Shenzhen Zhongzhuang Construction GroupLtd, beginning with the chart below.

Check out our latest analysis for Shenzhen Zhongzhuang Construction GroupLtd

What Does The Institutional Ownership Tell Us About Shenzhen Zhongzhuang Construction GroupLtd?

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.

Institutions have a very small stake in Shenzhen Zhongzhuang Construction GroupLtd. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Shenzhen Zhongzhuang Construction GroupLtd is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Zhong Zhuang with 25% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 1.6%, of the shares outstanding, respectively. Zhannuo Zhuang, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

On studying our ownership data, we found that 15 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Shenzhen Zhongzhuang Construction GroupLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

It seems insiders own a significant proportion of Shenzhen Zhongzhuang Construction Group Co.,Ltd. It has a market capitalization of just CN¥3.2b, and insiders have CN¥1.1b worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 60% stake in Shenzhen Zhongzhuang Construction GroupLtd, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenzhen Zhongzhuang Construction GroupLtd better, we need to consider many other factors. Take risks for example - Shenzhen Zhongzhuang Construction GroupLtd has 2 warning signs we think you should be aware of.

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.