Private companies own 18% of Xi'an Triangle Defense Co.,Ltd (SZSE:300775) shares but retail investors control 50% of the company

Key Insights

• The considerable ownership by retail investors in Xi'an Triangle DefenseLtd indicates that they collectively have a greater say in management and business strategy
• 49% of the business is held by the top 25 shareholders
• Institutional ownership in Xi'an Triangle DefenseLtd is 11%

A look at the shareholders of Xi'an Triangle Defense Co.,Ltd (SZSE:300775) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Private companies, on the other hand, account for 18% of the company's stockholders.

In the chart below, we zoom in on the different ownership groups of Xi'an Triangle DefenseLtd.

See our latest analysis for Xi'an Triangle DefenseLtd

What Does The Institutional Ownership Tell Us About Xi'an Triangle DefenseLtd?

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.

Xi'an Triangle DefenseLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Xi'an Triangle DefenseLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Xi'an Triangle DefenseLtd. Xi'an Aerospace Industry Investment Co., Ltd. is currently the company's largest shareholder with 11% of shares outstanding. The second and third largest shareholders are Sansen Industrial Investment Hubei Co., Ltd. and Guangdong Wens Investment Co., Ltd., with an equal amount of shares to their name at 6.6%.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Xi'an Triangle DefenseLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Our most recent data indicates that insiders own some shares in Xi'an Triangle Defense Co.,Ltd. This is a big company, so it is good to see this level of alignment. Insiders own CN¥697m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

With a 50% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Xi'an Triangle DefenseLtd. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

With a stake of 17%, private equity firms could influence the Xi'an Triangle DefenseLtd board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Private Company Ownership

We can see that Private Companies own 18%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Xi'an Triangle DefenseLtd you should be aware of, and 1 of them can't be ignored.

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