Guangdong Nedfon Air System Co., Ltd.'s (SZSE:301043) most bullish insider is CEO Qingquan Li, and their holdings value went up by 12% last week

Key Insights

• Significant insider control over Guangdong Nedfon Air System implies vested interests in company growth
• 66% of the company is held by a single shareholder (Qingquan Li)
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

If you want to know who really controls Guangdong Nedfon Air System Co., Ltd. (SZSE:301043), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 66% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, insiders benefitted the most after the company's market cap rose by CN¥226m last week.

Let's delve deeper into each type of owner of Guangdong Nedfon Air System, beginning with the chart below.

See our latest analysis for Guangdong Nedfon Air System

What Does The Institutional Ownership Tell Us About Guangdong Nedfon Air System?

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.

Less than 5% of Guangdong Nedfon Air System is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. So if the company itself can improve over time, we may well see more institutional buyers in the future. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Guangdong Nedfon Air System is not owned by hedge funds. The company's CEO Qingquan Li is the largest shareholder with 66% of shares outstanding. This implies that they possess majority interests and have significant control over the company. Investors usually consider it a good sign when the company leadership has such a significant stake, as this is widely perceived to increase the chance that the management will act in the best interests of the company. Taishan Zhenzhong Investment Partnership Enterprise (Limited Partnership) is the second largest shareholder owning 7.4% of common stock, and UBS Asset Management AG holds about 0.5% of the company stock.

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 Guangdong Nedfon Air System

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 the majority of Guangdong Nedfon Air System Co., Ltd.. This means they can collectively make decisions for the company. That means they own CN¥1.4b worth of shares in the CN¥2.1b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 23% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 7.4%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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. For instance, we've identified 1 warning sign for Guangdong Nedfon Air System that you should be aware of.

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.