Innovative Medical Management Co.,Ltd. (SZSE:002173) surges 18%; individual investors who own 52% shares profited along with insiders

Key Insights

• Significant control over Innovative Medical ManagementLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 19 shareholders own 48% of the company
• 26% of Innovative Medical ManagementLtd is held by insiders

Every investor in Innovative Medical Management Co.,Ltd. (SZSE:002173) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 52% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors gained the most after market cap touched CN¥5.0b last week, while insiders who own 26% also benefitted.

In the chart below, we zoom in on the different ownership groups of Innovative Medical ManagementLtd.

View our latest analysis for Innovative Medical ManagementLtd

What Does The Institutional Ownership Tell Us About Innovative Medical ManagementLtd?

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 Innovative Medical ManagementLtd does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Innovative Medical ManagementLtd's earnings history below. Of course, the future is what really matters.

Innovative Medical ManagementLtd is not owned by hedge funds. Our data shows that Xiaying Chen is the largest shareholder with 18% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.6% and 5.0% of the stock. Haijun Chen, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. In addition, we found that Jianjian Ma, the CEO has 0.7% of the shares allocated to their name.

Our studies suggest that the top 19 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 Innovative Medical ManagementLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that insiders maintain a significant holding in Innovative Medical Management Co.,Ltd.. Insiders own CN¥1.3b worth of shares in the CN¥5.0b company. 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 52% of Innovative Medical ManagementLtd shares. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Equity Ownership

Private equity firms hold a 5.0% stake in Innovative Medical ManagementLtd. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

We can see that Private Companies own 8.7%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Innovative Medical ManagementLtd better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.