Jiangsu Kanion Pharmaceutical Co.,Ltd.'s (SHSE:600557) stock price dropped 6.7% last week; individual investors would not be happy

Key Insights

• Significant control over Jiangsu Kanion PharmaceuticalLtd by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 8 investors have a majority stake in the company with 51% ownership
• 22% of Jiangsu Kanion PharmaceuticalLtd is held by Institutions

If you want to know who really controls Jiangsu Kanion Pharmaceutical Co.,Ltd. (SHSE:600557), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 38% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 6.7% decline in share price, individual investors suffered the most losses.

Let's delve deeper into each type of owner of Jiangsu Kanion PharmaceuticalLtd, beginning with the chart below.

Check out our latest analysis for Jiangsu Kanion PharmaceuticalLtd

What Does The Institutional Ownership Tell Us About Jiangsu Kanion PharmaceuticalLtd?

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.

We can see that Jiangsu Kanion PharmaceuticalLtd does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Jiangsu Kanion PharmaceuticalLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Jiangsu Kanion PharmaceuticalLtd. The company's largest shareholder is Jiangsu Kanion Group Co Ltd, with ownership of 31%. Meanwhile, the second and third largest shareholders, hold 5.6% and 3.1%, of the shares outstanding, respectively.

On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Jiangsu Kanion PharmaceuticalLtd

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.

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 some shares in Jiangsu Kanion Pharmaceutical Co.,Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around CN¥240m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 38% stake in Jiangsu Kanion PharmaceuticalLtd. 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

We can see that Private Companies own 37%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. Case in point: We've spotted 2 warning signs for Jiangsu Kanion PharmaceuticalLtd you should be aware of.

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.