Suzhou Xianglou New Material Co., Ltd. (SZSE:301160) insiders, who hold 44% of the firm would be disappointed by the recent pullback

Key Insights

• Insiders appear to have a vested interest in Suzhou Xianglou New Material's growth, as seen by their sizeable ownership
• The top 8 shareholders own 51% of the company
• 14% of Suzhou Xianglou New Material is held by Institutions

If you want to know who really controls Suzhou Xianglou New Material Co., Ltd. (SZSE:301160), then you'll have to look at the makeup of its share registry. With 44% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 7.0% decline in share price, insiders suffered the most losses.

Let's delve deeper into each type of owner of Suzhou Xianglou New Material, beginning with the chart below.

Check out our latest analysis for Suzhou Xianglou New Material

What Does The Institutional Ownership Tell Us About Suzhou Xianglou New Material?

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.

Suzhou Xianglou New Material 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. 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 Suzhou Xianglou New Material, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Suzhou Xianglou New Material. Our data shows that Hesheng Qian is the largest shareholder with 28% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.0% and 4.6% of the stock. Weiguo Tang, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Suzhou Xianglou New Material

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 Suzhou Xianglou New Material Co., Ltd.. Insiders own CN¥2.8b worth of shares in the CN¥6.5b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 37% stake in Suzhou Xianglou New Material. 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

Our data indicates that Private Companies hold 4.6%, of the company's shares. 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 3 warning signs for Suzhou Xianglou New Material (2 are a bit concerning!) that you should be aware of before investing here.

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.