Fujian Nebula Electronics Co., Ltd. (SZSE:300648) surges 11%; individual investors who own 54% shares profited along with insiders

Key Insights

• The considerable ownership by individual investors in Fujian Nebula Electronics indicates that they collectively have a greater say in management and business strategy
• The top 17 shareholders own 46% of the company
• 45% of Fujian Nebula Electronics is held by insiders

Every investor in Fujian Nebula Electronics Co., Ltd. (SZSE:300648) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While individual investors were the group that benefitted the most from last week’s CN¥330m market cap gain, insiders too had a 45% share in those profits.

In the chart below, we zoom in on the different ownership groups of Fujian Nebula Electronics.

See our latest analysis for Fujian Nebula Electronics

What Does The Institutional Ownership Tell Us About Fujian Nebula Electronics?

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.

Institutions have a very small stake in Fujian Nebula Electronics. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

Hedge funds don't have many shares in Fujian Nebula Electronics. Looking at our data, we can see that the largest shareholder is You Cai Li with 15% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 11% and 11%, of the shares outstanding, respectively. Two of the top three shareholders happen to be Chief Executive Officer and Member of the Board of Directors, respectively. That is, insiders feature higher up in the heirarchy of the company's top shareholders.

On studying our ownership data, we found that 17 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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Fujian Nebula Electronics

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. 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.

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.

It seems insiders own a significant proportion of Fujian Nebula Electronics Co., Ltd.. Insiders have a CN¥1.6b stake in this CN¥3.5b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 54% stake in Fujian Nebula Electronics, 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 Fujian Nebula Electronics better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with Fujian Nebula Electronics (including 1 which is potentially serious) .

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.