Zhenjiang Dongfang Electric Heating Technology Co.,Ltd's (SZSE:300217) market cap rose CN¥675m last week; individual investors who hold 55% profited and so did insiders

Key Insights

• Significant control over Zhenjiang Dongfang Electric Heating TechnologyLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 25 investors have a majority stake in the company with 45% ownership
• 36% of Zhenjiang Dongfang Electric Heating TechnologyLtd is held by insiders

A look at the shareholders of Zhenjiang Dongfang Electric Heating Technology Co.,Ltd (SZSE:300217) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual investors with 55% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Individual investors gained the most after market cap touched CN¥8.6b last week, while insiders who own 36% also benefitted.

Let's delve deeper into each type of owner of Zhenjiang Dongfang Electric Heating TechnologyLtd, beginning with the chart below.

View our latest analysis for Zhenjiang Dongfang Electric Heating TechnologyLtd

What Does The Institutional Ownership Tell Us About Zhenjiang Dongfang Electric Heating 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.

We can see that Zhenjiang Dongfang Electric Heating TechnologyLtd does have institutional investors; and they hold a good portion of the company's stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Zhenjiang Dongfang Electric Heating TechnologyLtd, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Zhenjiang Dongfang Electric Heating TechnologyLtd. The company's largest shareholder is Rongsheng Tan, with ownership of 13%. The second and third largest shareholders are Ke Tan and Wei Tan, with an equal amount of shares to their name at 11%. Wei Tan, who is the third-largest shareholder, also happens to hold the title of Vice Chairman.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Zhenjiang Dongfang Electric Heating TechnologyLtd

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

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 Zhenjiang Dongfang Electric Heating Technology Co.,Ltd. It is very interesting to see that insiders have a meaningful CN¥3.1b stake in this CN¥8.6b business. 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, who are usually individual investors, hold a substantial 55% stake in Zhenjiang Dongfang Electric Heating TechnologyLtd, suggesting it is a fairly popular stock. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhenjiang Dongfang Electric Heating TechnologyLtd better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Zhenjiang Dongfang Electric Heating TechnologyLtd you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.