Shenzhen Bioeasy Biotechnology Co., Ltd.'s (SZSE:300942) 20% gain last week benefited both private companies who own 45% as well as insiders

Key Insights

• Shenzhen Bioeasy Biotechnology's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• 57% of the business is held by the top 2 shareholders
• Insiders own 30% of Shenzhen Bioeasy Biotechnology

To get a sense of who is truly in control of Shenzhen Bioeasy Biotechnology Co., Ltd. (SZSE:300942), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 45% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While private companies were the group that reaped the most benefits after last week’s 20% price gain, insiders also received a 30% cut.

Let's take a closer look to see what the different types of shareholders can tell us about Shenzhen Bioeasy Biotechnology.

View our latest analysis for Shenzhen Bioeasy Biotechnology

What Does The Institutional Ownership Tell Us About Shenzhen Bioeasy Biotechnology?

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.

Since institutions own only a small portion of Shenzhen Bioeasy Biotechnology, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Shenzhen Bioeasy Biotechnology. Looking at our data, we can see that the largest shareholder is Shenzhen Bioeasy Holdings Co., Ltd. with 40% of shares outstanding. For context, the second largest shareholder holds about 17% of the shares outstanding, followed by an ownership of 6.6% by the third-largest shareholder.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 57% stake.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Shenzhen Bioeasy Biotechnology

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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

It seems insiders own a significant proportion of Shenzhen Bioeasy Biotechnology Co., Ltd.. Insiders own CN¥932m worth of shares in the CN¥3.1b company. 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-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 45%, of the company's shares. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenzhen Bioeasy Biotechnology better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Shenzhen Bioeasy Biotechnology .

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.