Retail investors among Anhui Zhonghuan Environmental Protection Technology Co.,Ltd's (SZSE:300692) largest shareholders, saw gain in holdings value after stock jumped 17% last week

Key Insights

• Significant control over Anhui Zhonghuan Environmental Protection TechnologyLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• 42% of the business is held by the top 15 shareholders
• Insiders own 16% of Anhui Zhonghuan Environmental Protection TechnologyLtd

Every investor in Anhui Zhonghuan Environmental Protection Technology Co.,Ltd (SZSE:300692) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 58% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, retail investors were the biggest beneficiaries of last week’s 17% gain.

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

See our latest analysis for Anhui Zhonghuan Environmental Protection TechnologyLtd

What Does The Institutional Ownership Tell Us About Anhui Zhonghuan Environmental Protection TechnologyLtd?

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.

Anhui Zhonghuan Environmental Protection TechnologyLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Anhui Zhonghuan Environmental Protection TechnologyLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Anhui Zhonghuan Environmental Protection TechnologyLtd. Bo Zhong Zhang is currently the company's largest shareholder with 16% of shares outstanding. Anhui Zhongchen Investment Holding Co., Ltd. is the second largest shareholder owning 13% of common stock, and Anhui Jintong Anyi Investment Management Partnership Enterprise (L.P.) holds about 4.2% of the company stock.

On studying our ownership data, we found that 15 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. 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 Anhui Zhonghuan Environmental Protection TechnologyLtd

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders maintain a significant holding in Anhui Zhonghuan Environmental Protection Technology Co.,Ltd. It has a market capitalization of just CN¥3.2b, and insiders have CN¥513m worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 58% of Anhui Zhonghuan Environmental Protection TechnologyLtd shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

It seems that Private Companies own 16%, of the Anhui Zhonghuan Environmental Protection TechnologyLtd stock. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Anhui Zhonghuan Environmental Protection TechnologyLtd better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Anhui Zhonghuan Environmental Protection TechnologyLtd (at least 2 which can't be ignored) , and understanding them should be part of your investment process.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.