Top Key Executive Dehong Gan, Chengdu Dahongli Machinery Co.,Ltd.'s (SZSE:300865) largest shareholder sees value of holdings go down 10% after recent drop

Key Insights

• Chengdu Dahongli MachineryLtd's significant insider ownership suggests inherent interests in company's expansion
• 69% of the company is held by a single shareholder (Dehong Gan)
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls Chengdu Dahongli Machinery Co.,Ltd. (SZSE:300865), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 71% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 10% decline in share price, insiders suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Chengdu Dahongli MachineryLtd.

See our latest analysis for Chengdu Dahongli MachineryLtd

What Does The Institutional Ownership Tell Us About Chengdu Dahongli MachineryLtd?

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 Chengdu Dahongli MachineryLtd. 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. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Chengdu Dahongli MachineryLtd is not owned by hedge funds. From our data, we infer that the largest shareholder is Dehong Gan (who also holds the title of Top Key Executive) with 69% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. Meanwhile, the second and third largest shareholders, hold 1.1% and 1.1%, of the shares outstanding, respectively. Interestingly, the second-largest shareholder, Dejun Gan is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

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

Insider Ownership Of Chengdu Dahongli MachineryLtd

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

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 that insiders own more than half the Chengdu Dahongli Machinery Co.,Ltd. stock. This gives them a lot of power. That means they own CN¥1.6b worth of shares in the CN¥2.2b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 24% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Chengdu Dahongli MachineryLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Chengdu Dahongli MachineryLtd you should know about.

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.