Sinofibers Technology Co.,Ltd.'s (SZSE:300777) market cap surged CN¥989m last week, retail investors who have a lot riding on the company were rewarded

Key Insights

• The considerable ownership by retail investors in Sinofibers TechnologyLtd indicates that they collectively have a greater say in management and business strategy
• 45% of the business is held by the top 25 shareholders
• Insiders own 13% of Sinofibers TechnologyLtd

To get a sense of who is truly in control of Sinofibers Technology Co.,Ltd. (SZSE:300777), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 54% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, retail investors collectively scored the highest last week as the company hit CN¥12b market cap following a 9.1% gain in the stock.

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

See our latest analysis for Sinofibers TechnologyLtd

What Does The Institutional Ownership Tell Us About Sinofibers TechnologyLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Sinofibers TechnologyLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Sinofibers TechnologyLtd's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Sinofibers TechnologyLtd. Changzhou Huatai Investment Management Co., Ltd. is currently the company's largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.8% and 3.4% of the stock. Furthermore, CEO Yuefang Wen is the owner of 2.1% of the company's shares.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Sinofibers TechnologyLtd

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own a reasonable proportion of Sinofibers Technology Co.,Ltd.. Insiders own CN¥1.6b worth of shares in the CN¥12b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 54% stake in Sinofibers TechnologyLtd, suggesting it is a fairly popular stock. 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.

Private Company Ownership

We can see that Private Companies own 19%, of the shares on issue. 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. For example, we've discovered 2 warning signs for Sinofibers TechnologyLtd that you should be aware of before investing here.

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.