Jilin Jian Yisheng Pharmaceutical Co., Ltd.'s (SZSE:002566) last week's 11% decline must have disappointed retail investors who have a significant stake

Key Insights

• The considerable ownership by retail investors in Jilin Jian Yisheng Pharmaceutical indicates that they collectively have a greater say in management and business strategy
• 48% of the business is held by the top 18 shareholders
• 44% of Jilin Jian Yisheng Pharmaceutical is held by insiders

If you want to know who really controls Jilin Jian Yisheng Pharmaceutical Co., Ltd. (SZSE:002566), then you'll have to look at the makeup of its share registry. We can see that retail investors own the lion's share in the company with 52% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders, who own 44% shares weren’t spared from last week’s CN¥238m market cap drop, retail investors as a group suffered the maximum losses

Let's take a closer look to see what the different types of shareholders can tell us about Jilin Jian Yisheng Pharmaceutical.

Check out our latest analysis for Jilin Jian Yisheng Pharmaceutical

What Does The Institutional Ownership Tell Us About Jilin Jian Yisheng Pharmaceutical?

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 Jilin Jian Yisheng Pharmaceutical, 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. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Jilin Jian Yisheng Pharmaceutical. Yisheng Zhang is currently the company's largest shareholder with 39% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 3.2% and 0.7%, of the shares outstanding, respectively. Additionally, the company's CEO Xiaomin Xue directly holds 0.5% of the total shares outstanding.

On studying our ownership data, we found that 18 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 Jilin Jian Yisheng Pharmaceutical

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

It seems insiders own a significant proportion of Jilin Jian Yisheng Pharmaceutical Co., Ltd.. It has a market capitalization of just CN¥2.0b, and insiders have CN¥882m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 52% of Jilin Jian Yisheng Pharmaceutical. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Jilin Jian Yisheng Pharmaceutical better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Jilin Jian Yisheng Pharmaceutical .

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.