Insiders were the biggest winners as Guangdong Brandmax Marketing Co.,Ltd.'s (SZSE:300805) market cap grew by CN¥372m last week

Key Insights

• Significant insider control over Guangdong Brandmax MarketingLtd implies vested interests in company growth
• A total of 3 investors have a majority stake in the company with 53% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Guangdong Brandmax Marketing Co.,Ltd. (SZSE:300805) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 67% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders scored the highest last week as the company hit CN¥4.7b market cap following a 8.6% gain in the stock.

Let's delve deeper into each type of owner of Guangdong Brandmax MarketingLtd, beginning with the chart below.

Check out our latest analysis for Guangdong Brandmax MarketingLtd

What Does The Lack Of Institutional Ownership Tell Us About Guangdong Brandmax MarketingLtd?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Guangdong Brandmax MarketingLtd, for yourself, below.

We note that hedge funds don't have a meaningful investment in Guangdong Brandmax MarketingLtd. Dingjiao Liang is currently the largest shareholder, with 32% of shares outstanding. With 13% and 7.7% of the shares outstanding respectively, Yong Huang and Li Zhang are the second and third largest shareholders. Yong Huang, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. 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 Guangdong Brandmax MarketingLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

It seems that insiders own more than half the Guangdong Brandmax Marketing Co.,Ltd. stock. This gives them a lot of power. That means they own CN¥3.2b worth of shares in the CN¥4.7b company. That's quite meaningful. 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

With a 31% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guangdong Brandmax MarketingLtd. 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 example, we've discovered 3 warning signs for Guangdong Brandmax MarketingLtd (2 are a bit unpleasant!) that you should be aware of before investing here.

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.

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.