Both individual investors who control a good portion of Shannon Semiconductor Technology Co.,Ltd. (SZSE:300475) along with institutions must be dismayed after last week's 9.4% decrease

Key Insights

• Significant control over Shannon Semiconductor TechnologyLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 8 shareholders
• 14% of Shannon Semiconductor TechnologyLtd is held by insiders

Every investor in Shannon Semiconductor Technology Co.,Ltd. (SZSE:300475) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 33% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions who own 26% came under pressure after market cap dropped to CN¥12b last week,individual investors took the most losses.

Let's delve deeper into each type of owner of Shannon Semiconductor TechnologyLtd, beginning with the chart below.

See our latest analysis for Shannon Semiconductor TechnologyLtd

What Does The Institutional Ownership Tell Us About Shannon Semiconductor TechnologyLtd?

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.

As you can see, institutional investors have a fair amount of stake in Shannon Semiconductor TechnologyLtd. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Shannon Semiconductor TechnologyLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Shannon Semiconductor TechnologyLtd is not owned by hedge funds. Our data shows that Shenzhen Lingxin Jishi Equity Investment Fund Management Partnership Enterprise (L.P.) is the largest shareholder with 17% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.0% and 5.2% of the stock.

We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Shannon Semiconductor TechnologyLtd

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

It seems insiders own a significant proportion of Shannon Semiconductor Technology Co.,Ltd.. It has a market capitalization of just CN¥12b, and insiders have CN¥1.7b worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shannon Semiconductor TechnologyLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

Private equity firms hold a 22% stake in Shannon Semiconductor TechnologyLtd. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

It seems that Private Companies own 5.0%, of the Shannon Semiconductor TechnologyLtd stock. 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:

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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Shannon Semiconductor TechnologyLtd (at least 1 which is concerning) , and understanding them should be part of your investment process.

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.

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