Individual investors invested in Huachuang Yunxin Digital Technology Co., Ltd. (SHSE:600155) copped the brunt of last week's CN¥1.0b market cap decline

Key Insights

• Significant control over Huachuang Yunxin Digital Technology by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 22 investors have a majority stake in the company with 50% ownership
• 15% of Huachuang Yunxin Digital Technology is held by Institutions

To get a sense of who is truly in control of Huachuang Yunxin Digital Technology Co., Ltd. (SHSE:600155), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 48% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors as a group endured the highest losses last week after market cap fell by CN¥1.0b.

Let's delve deeper into each type of owner of Huachuang Yunxin Digital Technology, beginning with the chart below.

See our latest analysis for Huachuang Yunxin Digital Technology

What Does The Institutional Ownership Tell Us About Huachuang Yunxin Digital Technology?

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.

As you can see, institutional investors have a fair amount of stake in Huachuang Yunxin Digital Technology. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Huachuang Yunxin Digital Technology's earnings history below. Of course, the future is what really matters.

Huachuang Yunxin Digital Technology is not owned by hedge funds. The company's largest shareholder is Newhope Chemicals Investment Co., Ltd., with ownership of 5.5%. With 5.4% and 5.1% of the shares outstanding respectively, Shanghai Shanrong Industry Co. and New Hope Holdings Co., Ltd. are the second and third largest shareholders.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 22 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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 Huachuang Yunxin Digital Technology

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public-- including retail investors -- own 48% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 32%, of the shares on issue. 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.

Public Company Ownership

Public companies currently own 3.3% of Huachuang Yunxin Digital Technology stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Huachuang Yunxin Digital Technology better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Huachuang Yunxin Digital Technology you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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