Individual investors own 36% of Shandong Sunpaper Co., Ltd. (SZSE:002078) shares but private companies control 45% of the company

Key Insights

• Shandong Sunpaper's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 2 shareholders own 51% of the company
• Institutions own 12% of Shandong Sunpaper

If you want to know who really controls Shandong Sunpaper Co., Ltd. (SZSE:002078), then you'll have to look at the makeup of its share registry. 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).

Individual investors, on the other hand, account for 36% of the company's stockholders.

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

See our latest analysis for Shandong Sunpaper

What Does The Institutional Ownership Tell Us About Shandong Sunpaper?

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.

Shandong Sunpaper 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. 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 Shandong Sunpaper's earnings history below. Of course, the future is what really matters.

Shandong Sunpaper is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Shandong Sun Holding Group Co., Ltd. with 45% of shares outstanding. National Council for Social Security Fund is the second largest shareholder owning 6.2% of common stock, and Zhongtai Securities (Shanghai) Asset Management Co.,Ltd. holds about 1.6% of the company stock.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Shandong Sunpaper

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

Our most recent data indicates that insiders own less than 1% of Shandong Sunpaper Co., Ltd.. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Keep in mind that it's a big company, and the insiders own CN¥368m worth of shares. The absolute value might be more important than the proportional share. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

With a 36% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shandong Sunpaper. 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

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

It's always worth thinking about the different groups who own shares in a company. But to understand Shandong Sunpaper better, we need to consider many other factors. For instance, we've identified 1 warning sign for Shandong Sunpaper that you should be aware of.

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.