Canmax Technologies Co., Ltd.'s (SZSE:300390) market cap dropped CN¥1.1b last week; Retail investors bore the brunt

Key Insights

• Canmax Technologies' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 44% of the business is held by the top 25 shareholders
• Insiders own 34% of Canmax Technologies

Every investor in Canmax Technologies Co., Ltd. (SZSE:300390) should be aware of the most powerful shareholder groups. We can see that retail investors own the lion's share in the company with 54% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders who own 34% came under pressure after market cap dropped to CN¥20b last week,retail investors took the most losses.

In the chart below, we zoom in on the different ownership groups of Canmax Technologies.

Check out our latest analysis for Canmax Technologies

What Does The Institutional Ownership Tell Us About Canmax Technologies?

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 Canmax Technologies. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Canmax Technologies, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Canmax Technologies. Our data shows that Zhenhua Pei is the largest shareholder with 24% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.1% and 1.5% of the stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Canmax Technologies

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Canmax Technologies Co., Ltd.. Insiders own CN¥6.6b worth of shares in the CN¥20b company. That's quite meaningful. 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 -- including retail investors -- own 54% of Canmax Technologies. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Canmax Technologies better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Canmax Technologies (of which 1 shouldn't be ignored!) you should know about.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.