The recent 10% gain must have brightened CEO Mingming Hu's week, Wuxi Delinhai Environmental Technology Co.,Ltd's (SHSE:688069) most bullish insider

Key Insights

• Significant insider control over Wuxi Delinhai Environmental TechnologyLtd implies vested interests in company growth
• 57% of the business is held by the top 3 shareholders
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of Wuxi Delinhai Environmental Technology Co.,Ltd (SHSE:688069), it is important to understand the ownership structure of the business. With 65% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders were the biggest beneficiaries of last week’s 10% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Wuxi Delinhai Environmental TechnologyLtd.

View our latest analysis for Wuxi Delinhai Environmental TechnologyLtd

What Does The Institutional Ownership Tell Us About Wuxi Delinhai Environmental TechnologyLtd?

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.

Since institutions own only a small portion of Wuxi Delinhai Environmental TechnologyLtd, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. 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 Wuxi Delinhai Environmental TechnologyLtd. The company's CEO Mingming Hu is the largest shareholder with 40% of shares outstanding. For context, the second largest shareholder holds about 9.8% of the shares outstanding, followed by an ownership of 7.6% by the third-largest shareholder.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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

Insider Ownership Of Wuxi Delinhai Environmental TechnologyLtd

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.

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 that insiders own more than half the Wuxi Delinhai Environmental Technology Co.,Ltd stock. This gives them a lot of power. That means they own CN¥1.1b worth of shares in the CN¥1.6b 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

The general public-- including retail investors -- own 30% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Wuxi Delinhai Environmental TechnologyLtd better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Wuxi Delinhai Environmental TechnologyLtd .

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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