Doctorglasses Chain Co.,Ltd.'s (SZSE:300622) stock price dropped 5.4% last week; individual investors would not be happy

Key Insights

• The considerable ownership by individual investors in Doctorglasses ChainLtd indicates that they collectively have a greater say in management and business strategy
• The top 7 shareholders own 50% of the company
• 44% of Doctorglasses ChainLtd is held by insiders

Every investor in Doctorglasses Chain Co.,Ltd. (SZSE:300622) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of individual investors took a hit after last week’s 5.4% price drop, insiders with their 44% also suffered.

In the chart below, we zoom in on the different ownership groups of Doctorglasses ChainLtd.

View our latest analysis for Doctorglasses ChainLtd

What Does The Institutional Ownership Tell Us About Doctorglasses ChainLtd?

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.

Doctorglasses ChainLtd 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 Doctorglasses ChainLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Doctorglasses ChainLtd. Looking at our data, we can see that the largest shareholder is the CEO Louisa Fan with 22% of shares outstanding. In comparison, the second and third largest shareholders hold about 20% and 5.0% of the stock.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Doctorglasses ChainLtd

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Doctorglasses Chain Co.,Ltd.. It has a market capitalization of just CN¥8.3b, and insiders have CN¥3.6b worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 48% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Doctorglasses ChainLtd. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Doctorglasses ChainLtd better, we need to consider many other factors. For example, we've discovered 3 warning signs for Doctorglasses ChainLtd (1 is significant!) that you should be aware of before investing here.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.