Yinbang Clad Material Co.,Ltd's (SZSE:300337) stock price dropped 12% last week; retail investors would not be happy

Key Insights

• The considerable ownership by retail investors in Yinbang Clad MaterialLtd indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 7 shareholders
• 24% of Yinbang Clad MaterialLtd is held by insiders

If you want to know who really controls Yinbang Clad Material Co.,Ltd (SZSE:300337), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 49% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While the holdings of retail investors took a hit after last week’s 12% price drop, insiders with their 24% also suffered.

In the chart below, we zoom in on the different ownership groups of Yinbang Clad MaterialLtd.

See our latest analysis for Yinbang Clad MaterialLtd

What Does The Institutional Ownership Tell Us About Yinbang Clad MaterialLtd?

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.

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

Yinbang Clad MaterialLtd is not owned by hedge funds. With a 24% stake, CEO Jiansheng Shen is the largest shareholder. For context, the second largest shareholder holds about 15% of the shares outstanding, followed by an ownership of 6.4% by the third-largest shareholder.

We did some more digging and found that 7 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. 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 Yinbang Clad MaterialLtd

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.

Our information suggests that insiders maintain a significant holding in Yinbang Clad Material Co.,Ltd. It has a market capitalization of just CN¥8.5b, and insiders have CN¥2.1b worth of shares in their own names. That's quite significant. 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

With a 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Yinbang Clad MaterialLtd. 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 21%, of the Yinbang Clad MaterialLtd 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Yinbang Clad MaterialLtd better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Yinbang Clad MaterialLtd you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.