Hangzhou Electronic Soul Network Technology Co., Ltd.'s (SHSE:603258) most bullish insider, Chief Investment Officer Fang Chen must be pleased with the recent 6.5% gain

Key Insights

• Significant insider control over Hangzhou Electronic Soul Network Technology implies vested interests in company growth
• 51% of the business is held by the top 6 shareholders
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

Every investor in Hangzhou Electronic Soul Network Technology Co., Ltd. (SHSE:603258) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 59% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥392m last week.

Let's delve deeper into each type of owner of Hangzhou Electronic Soul Network Technology, beginning with the chart below.

Check out our latest analysis for Hangzhou Electronic Soul Network Technology

What Does The Institutional Ownership Tell Us About Hangzhou Electronic Soul Network Technology?

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.

Since institutions own only a small portion of Hangzhou Electronic Soul Network Technology, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. So if the company itself can improve over time, we may well see more institutional buyers in the future. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Hedge funds don't have many shares in Hangzhou Electronic Soul Network Technology. From our data, we infer that the largest shareholder is Fang Chen (who also holds the title of Chief Investment Officer) with 11% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. Meanwhile, the second and third largest shareholders, hold 9.8% and 8.9%, of the shares outstanding, respectively. Interestingly, the second-largest shareholder, Jianping Hu is also Chief Executive Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.

We did some more digging and found that 6 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Hangzhou Electronic Soul Network Technology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own the majority of Hangzhou Electronic Soul Network Technology Co., Ltd.. This means they can collectively make decisions for the company. Given it has a market cap of CN¥6.4b, that means they have CN¥3.8b worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. 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 36% stake in Hangzhou Electronic Soul Network Technology. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

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 instance, we've identified 4 warning signs for Hangzhou Electronic Soul Network Technology (1 doesn't sit too well with us) that you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.