The recent pullback must have dismayed Zhejiang Guanghua Technology Co.,Ltd. (SZSE:001333) insiders who own 61% of the company

Key Insights

• Significant insider control over Zhejiang Guanghua TechnologyLtd implies vested interests in company growth
• 55% of the company is held by a single shareholder (Jiefeng Sun)
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Zhejiang Guanghua Technology Co.,Ltd. (SZSE:001333) can tell us which group is most powerful. With 61% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to CN¥2.1b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Zhejiang Guanghua TechnologyLtd, beginning with the chart below.

View our latest analysis for Zhejiang Guanghua TechnologyLtd

What Does The Institutional Ownership Tell Us About Zhejiang Guanghua TechnologyLtd?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

As you can see, institutional investors have a fair amount of stake in Zhejiang Guanghua TechnologyLtd. 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 Zhejiang Guanghua TechnologyLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Zhejiang Guanghua TechnologyLtd. The company's largest shareholder is Jiefeng Sun, with ownership of 55%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. The second and third largest shareholders are Haining Fenghua Investment Consulting Partnership Enterprise (Limited Partnership) and Chunhai Yao, with an equal amount of shares to their name at 5.5%. Chunhai Yao, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

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

Insider Ownership Of Zhejiang Guanghua TechnologyLtd

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.

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 that insiders own more than half the Zhejiang Guanghua Technology Co.,Ltd. stock. This gives them a lot of power. Given it has a market cap of CN¥2.1b, that means they have CN¥1.3b worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 26% stake in Zhejiang Guanghua TechnologyLtd. 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.

Private Company Ownership

It seems that Private Companies own 6.2%, of the Zhejiang Guanghua TechnologyLtd stock. 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:

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. Be aware that Zhejiang Guanghua TechnologyLtd is showing 2 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.