Private companies among Yarward Electronics (Shandong) Co., Ltd.'s (SZSE:301337) largest stockholders and were hit after last week's 12% price drop

Key Insights

• Yarward Electronics (Shandong)'s significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 2 investors have a majority stake in the company with 55% ownership
• 17% of Yarward Electronics (Shandong) is held by insiders

Every investor in Yarward Electronics (Shandong) Co., Ltd. (SZSE:301337) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 47% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 12% decline in share price, private companies suffered the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Yarward Electronics (Shandong).

View our latest analysis for Yarward Electronics (Shandong)

What Does The Institutional Ownership Tell Us About Yarward Electronics (Shandong)?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Less than 5% of Yarward Electronics (Shandong) is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. 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 Yarward Electronics (Shandong). Shenzhen Zhongya Huaxin Technology Co.,Ltd. is currently the largest shareholder, with 46% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.3% and 5.2%, of the shares outstanding, respectively.

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 55% 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Yarward Electronics (Shandong)

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 Yarward Electronics (Shandong) Co., Ltd.. Insiders own CN¥488m worth of shares in the CN¥2.9b 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

With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Yarward Electronics (Shandong). 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

It seems that Private Companies own 47%, of the Yarward Electronics (Shandong) stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for Yarward Electronics (Shandong) (of which 1 doesn't sit too well with us!) you should know about.

Of course this may not be the best stock to buy. So take a peek at this free 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.