Public companies among Shandong Humon Smelting Co., Ltd.'s (SZSE:002237) largest stockholders and were hit after last week's 6.3% price drop

Key Insights

• Shandong Humon Smelting's significant public 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 50% ownership
• 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 Shandong Humon Smelting Co., Ltd. (SZSE:002237) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are public companies with 44% 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 6.3% decline in share price, public companies suffered the most losses.

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

See our latest analysis for Shandong Humon Smelting

What Does The Institutional Ownership Tell Us About Shandong Humon Smelting?

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 Shandong Humon Smelting. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Shandong Humon Smelting's historic earnings and revenue below, but keep in mind there's always more to the story.

Shandong Humon Smelting is not owned by hedge funds. Our data shows that Jiangxi Copper Company Limited is the largest shareholder with 44% of shares outstanding. Yantai Humon Group Co., Ltd. is the second largest shareholder owning 5.9% of common stock, and New China Life Insurance Co., Ltd., Asset Management Arm holds about 1.1% of the company stock.

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 50% 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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Shandong Humon Smelting

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. 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 some shares in Shandong Humon Smelting Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥128m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 41% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 6.4%, of the Shandong Humon Smelting stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

Public companies currently own 44% of Shandong Humon Smelting stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Shandong Humon Smelting is showing 3 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.