Gifore Agricultural Science & Technology Service Co.,Ltd's (SZSE:300022) stock price dropped 11% last week; retail investors would not be happy

Key Insights

• Significant control over Gifore Agricultural Science & Technology ServiceLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• A total of 19 investors have a majority stake in the company with 41% ownership
• Insiders own 16% of Gifore Agricultural Science & Technology ServiceLtd

A look at the shareholders of Gifore Agricultural Science & Technology Service Co.,Ltd (SZSE:300022) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 59% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 11% decline in share price, retail investors suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Gifore Agricultural Science & Technology ServiceLtd.

View our latest analysis for Gifore Agricultural Science & Technology ServiceLtd

What Does The Lack Of Institutional Ownership Tell Us About Gifore Agricultural Science & Technology ServiceLtd?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Gifore Agricultural Science & Technology ServiceLtd's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

Hedge funds don't have many shares in Gifore Agricultural Science & Technology ServiceLtd. Our data shows that Sichuan Mayflower Development Service Co., Ltd. is the largest shareholder with 23% of shares outstanding. With 7.5% and 6.6% of the shares outstanding respectively, Xinming Wang and Hongyan Wang are the second and third largest shareholders. Hongyan Wang, who is the third-largest shareholder, also happens to hold the title of Vice Chairman.

On studying our ownership data, we found that 19 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Gifore Agricultural Science & Technology ServiceLtd

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. 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 information suggests that insiders maintain a significant holding in Gifore Agricultural Science & Technology Service Co.,Ltd. It has a market capitalization of just CN¥2.2b, and insiders have CN¥335m 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, mostly comprising of individual investors, collectively holds 59% of Gifore Agricultural Science & Technology ServiceLtd shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

We can see that Private Companies own 25%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.