Daodaoquan Grain and Oil Co.,Ltd.'s (SZSE:002852) 12% gain last week benefited both individual investors who own 50% as well as insiders

Key Insights

• Significant control over Daodaoquan Grain and OilLtd 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 50% ownership
• Insiders own 40% of Daodaoquan Grain and OilLtd

A look at the shareholders of Daodaoquan Grain and Oil Co.,Ltd. (SZSE:002852) can tell us which group is most powerful. The group holding the most number of shares in the company, around 50% to be precise, is individual investors. 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¥2.5b last week, while insiders who own 40% also benefitted.

Let's delve deeper into each type of owner of Daodaoquan Grain and OilLtd, beginning with the chart below.

See our latest analysis for Daodaoquan Grain and OilLtd

What Does The Institutional Ownership Tell Us About Daodaoquan Grain and OilLtd?

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.

Daodaoquan Grain and OilLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Daodaoquan Grain and OilLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Daodaoquan Grain and OilLtd is not owned by hedge funds. The company's CEO Jian Jun Liu is the largest shareholder with 34% of shares outstanding. Guangdong Hengkuo Investment Management Co., Ltd. is the second largest shareholder owning 4.1% of common stock, and Rong Jiang holds about 2.4% of the company stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 Daodaoquan Grain and OilLtd

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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Daodaoquan Grain and Oil Co.,Ltd.. Insiders have a CN¥994m stake in this CN¥2.5b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 50% of Daodaoquan Grain and OilLtd 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 3 warning signs we've spotted with Daodaoquan Grain and OilLtd (including 2 which are a bit unpleasant) .

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.